Question 4506:

The main function of price mechanism is to ____________

A. Limit consumer demand
B. Enable producers make profits
C. Allocate scarce resources among competing ends
D. Ensure consumer sovereignty
E. Achieve excess capacity

Question 4507:

When government intervenes in price-setting, the regulated price is usually ____________

A. Higher than the last price
B. Lower than the last price
C. Higher than the equilibrium price
D. Lower than the equilibrium price
E. Higher than the ceiling price

Question 4508:

A firm achieves least cost in production by substituting factors until

A. Their factor prices are equal
B. Their marginal products are equal to the factor prices
C. Their marginal products are each equal to zero
D. The ratios of their marginal product equals the ratio of their prices
E. None of the above

Question 4509:

A production possibility curve shows ____________

A. How much of resources a society uses to produce a particular commodity
B. The rate of inflation
C. The rate of unemployment in an economy
D. The various combinations of the commodities that can be produced
E. All of the above

Question 4510:

A rightward shift in the production possibility frontier may be due to ____________

A. Use of inferior inputs
B. Inefficiency
C. Improvement in production techniques and practices
D. Changes in the product mix
E. Changes in consumer taste