What Is Often the Effect of Austerity Measures in a Country

question 41

Multiple Choice

What is often the effect of austerity measures in a country?

• A)An immediate increase in imports by the population
• B)A recession or depression
• C)A surge in support for the government
• D)An increase in overall spending by the population

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Definitions:

Barrier to Entry

Factors that prevent or hinder companies from entering into a specific market or industry.

Allocative Efficiency

A state of resource allocation where every good or service is produced up to the point where the last unit provides a marginal benefit to consumers equal to the marginal cost of producing it.

Market Power

The ability of a firm or group of firms to manipulate the price or supply of a good or service in the market, often by limiting availability or by altering consumer demand through control of significant portions of the market.

Cartels

associations of independent businesses formed to control production, pricing, and marketing to monopolize a market or restrict competition.