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In an economy in which decisions are guided by prices and individual self-interest, there is: 
 
(i) the potential to achieve efficiency in production.
(ii) a strong need for government intervention in the market.
(iii) less efficiency than would be observed in a centrally-planned economy.
(iv) more need for a strong legal system to control individual greed than would be needed in a centrally-planned economy.

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Khushboo GoyalLv5
29 Jan 2020
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Related questions

In an economy in which decisions are guided by prices and individual self-interest, there is:

a. the potential to reach efficiency in production 

b. a strong need for government intervention in the economy.

c. less efficiency than otherwise be in a centrally planned economy. 

d. more need for a strong legal system to control individual greed than would be needed in a centrally planned economy  

In an economy in which decisions are guided by prices and individual self-interest, there is: 

 

(i) the need for a third party intervention such as that of a government. 

(ii) the potential to optimize efficiency in production. 

(iii) less efficiency compared to what would be in a command economy. 

(iv) the need for a strong authority to regulate individual greed that what would be required in a centrally planned economy.

 

 

1. A positive statement is one which is:

a. derived by induction.

b. derived by deduction.

c. subjective and is based on a value judgment.

d. objective and is based on facts

 

2. The invisible hand refers to the:

a. fact that the U.S. tax system redistributes income from rich to poor.

b. notion that, under competition, decisions motivated by self-interest promote the social interest.

c. tendency of monopolistic sellers to raise prices above competitive levels.

d. fact that government controls the functioning of the market system

 

3. Innovation lagged in the centrally planned economies because:

a. there was too much domestic business competition.

b. there was too much competition from foreign firms.

c. enterprises resisted innovation out of fear that their production targets would be raised.

d. exports had to equal imports for the plan to work.

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