Which of the Following Statements Is TRUE

question 133

Multiple Choice

Which of the following statements is TRUE?

• A) Monopolized economies tend to have more poverty and less economic growth.
• B) Competitive market economies lead to higher prices for everyone.
• C) Social prosperity is typically the result of government-created monopolies.
• D) Business leaders in the United States are more self-interested than business leaders in lesser-developed nations.

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Definitions:

Diminishing Returns

A principle in economics indicating that adding more of one factor of production, while holding others constant, will at some point yield lower incremental per-unit returns.

Constant Costs

Costs that remain the same in total, regardless of changes in the volume of goods or services produced.

Average Variable Cost

The total variable costs of production divided by the quantity of output produced; it shows the variable cost per unit.

Average Fixed Cost

The fixed costs of production (costs that do not change with the level of output) divided by the quantity of output produced, decreases as production increases.