The Metaphor Used to Describe the Working of the Price

question 76

Multiple Choice

The metaphor used to describe the working of the price system to achieve efficiency in a free market is

• A)Occam's razor.
• B)the prisoner's dilemma.
• C)the invisible hand.
• D)the benefit principle.

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Definitions:

Duopoly

A market structure dominated by two firms, each of which has significant control over the market price.

Demand Curves

Graphical representations showing the relationship between the price of a good and the quantity of that good consumers are willing and able to purchase at different prices.

Marginal Revenue Curve

A graphical representation showing how marginal revenue varies as the quantity of output sold changes, typically downwards sloping for firms in imperfectly competitive markets.

Collude

To cooperate with others, often secretly, to deceive or gain an unfair advantage in the market.