Contestable Markets Improve the Performance of Imperfect Markets with

question 8

Multiple Choice

Contestable markets improve the performance of imperfect markets with

• A)government regulations.
• B)the threat of entry.
• C)advertising.
• D)tacit collusion.

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Definitions:

Increase in Price

A situation where the cost of a product or service rises over a period of time.

Excise Tax

A tax levied on specific goods, services, or transactions, often with the aim of reducing their consumption or raising revenue.

Imported Items

Goods brought into a country from abroad for sale.

Tariff

A tax imposed by a government on goods and services imported from other countries to protect domestic industries or to generate revenue.