Welfare Economics Is the Study of How​ the Allocation of Resources

question 82

Multiple Choice

Welfare economics is the study of how​ the allocation of resources affects economic well-being.

• A)​the allocation of resources affects economic well-being.
• B)​price controls work.
• C)​the government helps poor people.
• D)​to produce greater equality.

Calculate the labor force, unemployment rate, labor force participation rate, and other relevant labor market statistics.

Evaluate the effects of unemployment insurance on the labor market.

Analyze the impact of the internet on frictional unemployment.

Define and differentiate between frictional, structural, and cyclical unemployment.

---

Definitions:

Short Run

A period during which at least one input, such as plant size, is fixed and cannot be varied.

Marginal Decision Rule

The principle of making decisions based on the additional cost vs. additional benefit of the next unit.

MC < MR

This indicates a scenario in economic theory where the marginal cost of producing an additional unit is less than the marginal revenue gained from selling that unit.

Monopolistic Competition

A market structure characterized by many firms selling similar but not identical products, allowing for some degree of market power and product differentiation.