Which of the Following Statements About Economic Decision Making Is

question 187

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.
• E) All of the above are true statements.

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Definitions:

Mead

An alcoholic beverage created by fermenting honey with water, sometimes with various fruits, spices, grains, or hops added.

Demand Function

A mathematical representation that describes the relationship between the quantity demanded of a good and various factors that influence this quantity, such as price.

Consumer's Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount that they actually pay.

Mead

An alcoholic beverage created by fermenting honey with water, sometimes with various fruits, spices, grains, or hops.