Economics Concepts and Government Intervention

What is a potential consequence of firms merging?

Which factor is crucial in determining if a good is classified as a private or public good?

What is one potential incentive for more airlines to fly on a specific route?

What is one benefit of increased competition among airlines for consumers?

What does allocative efficiency require for resources in an economy?

What might happen if resources are immobile in an economy?

What is an example of geographical immobility of resources?

How can a country experience unemployment despite high demand for certain services?

Which of the following types of goods is most likely to require government financing?

What is a potential external benefit of a government subsidy for rail travel?

If a firm decides to install new equipment to reduce pollution, how do private and external costs change?

Which argument supports state intervention in an economy?

Who primarily decides what is produced in a market economy?

What is a likely consequence of implementing a maximum price in a market?

In which scenario would external costs likely increase?

Which of the following is NOT a reason for government intervention in the economy?

What is considered as legal tender in most countries?

Which of the following is NOT a function of money?

Why is money considered a better store of value than perishable items?

Which method is NOT typically used to transfer money between bank accounts?

In the context of money, what does the term 'unit of account' refer to?

What is the most widely used form of money in terms of payment value?

How does money facilitate economic transactions?

Which of these statements about bank accounts is true?

What is one consequence of information failure in a market?

What type of information failure occurs when consumers and suppliers have unequal access to information?

Which of the following is a prime example of a merit good?

Why might merit goods be under-consumed in a free market?

What external benefit might result from increased consumption of merit goods like healthcare?

Which of the following describes a scenario of asymmetric information?

Which of the following actions can governments take to combat the under-consumption of merit goods?

What can result from the underproduction of merit goods?

What is a potential result of successfully providing information on the benefits of a product?

In the context of market forces, what happens if demand does not increase despite efforts to inform consumers?

What does the price need to fall to in order to achieve the allocatively efficient quantity Qx?

What can a government do if consumers undervalue a product significantly?

How does a subsidy affect the supply curve?

What does the term allocatively efficient imply in the context of public goods?

What example is given to illustrate the concept of compulsory consumption?

Which of the following is an effect of shifting the supply curve right due to a subsidy?

Which of the following statements best describes monopoly power?

What is price fixing?

Which of the following is a characteristic of a public good?

Why might market failure occur in situations of monopoly?

What is one way governments prevent abuse of market power?

Which example is categorized as a public good?

What might indicate a firm is abusing its market power?

Which of the following is NOT a potential effect of a monopoly?