The Ability to Purchase a Product Is a Function of

question 25

Multiple Choice

The ability to purchase a product is a function of

• A) buying power.
• B) desire.
• C) willingness.
• D) authority.
• E) needs.

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Definitions:

Marginal Cost

The financial increase due to the production of an extra product or service unit.

Artificially Scarce Good

A product or service whose availability is restricted through patents, copyrights, or other legal means, rather than by the limits of physical scarcity.

Pigouvian Tax

A tax imposed on activities that generate negative externalities, intended to correct an inefficient market outcome by internalizing the external costs.

Efficient Level

A point at which resources are allocated in the most effective manner, maximizing output without wasting resources.