Which of the Following Statements About Economic Decision Making Is

question 97

Multiple Choice

Which of the following statements about economic decision making is TRUE?

• A) In a market-directed economy, the micro-level decisions of individual producers and consumers determine the macro-level decisions.
• B) Government planning usually works best when economies become more complex and the variety of goods and services produced is fairly large.
• C) The United States may be considered a pure market-directed economy.
• D) Command economies usually rely on market forces to determine prices.

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Definitions:

Selling Price

The amount of money that a buyer pays to purchase a product or service from a seller.

Cost Structure

The composition of a company's costs, including fixed and variable costs.

Equipment Depreciation

The allocation of the cost of physical assets over their useful lives, recognizing the reduction in value due to wear and tear, obsolescence, or age.

Material Costs

Expenses associated with the raw materials and components required for manufacturing goods.