The Failure of Communism in a Large Number of Countries

question 90

Multiple Choice

The failure of communism in a large number of countries is at least partly explained by

• A)the fact that those countries relied absolutely on the invisible hand.
• B)the fact that those countries did little or nothing to restrict trade with other countries.
• C)the lack of information,on the part of central planners in those countries,about tastes and preferences in their economies.
• D)the lack of information,on the part of central planners in those countries,about how much authority the government had in affecting economic outcomes.

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Definitions:

Total Costs

The total of all costs associated with manufacturing goods or providing services, encompassing both fixed and variable expenses.

Total Variable Costs

The overall expenses that change in proportion to the activity of a business, such as production volume or units of service delivered.

Total Fixed Costs

The sum of all costs that remain constant regardless of the level of production or output within a specific period.

Total Variable Costs

The sum of all costs that vary directly with the level of production or output, excluding fixed costs.