What effect does new technology usually have on an economy *?
a. It makes the economy stronger and more efficient.
How do consumers make their desires known to businesses?
A fundamental purpose of the free enterprise system is to give consumers the freedom to make their own economic choices. Through their economic dealings with producers, consumers make their desires known . When buying products, they indicate to producers what to produce and how much to make .
What is an important advantage of a free market?
Supporters of a free market economy claim that the system has the following advantages : It contributes to political and civil freedom, in theory, since everybody has the right to choose what to produce or consumer. It contributes to economic growth and transparency. It ensures competitive markets .
Why does the government use its power to make sure that businesses disclose so much information to the public?
Why does government use its power to make sure businesses disclose information to the public ? So they can get data and feedback from the consumers, so they can be efficient with their sales. To allow individuals to operate their businesses in ways they think will maximize their profits.
What are the stages of the business cycle?
The four stages of the economic cycle are also referred to as the business cycle. These four stages are expansion , peak, contraction, and trough. During the expansion phase, the economy experiences relatively rapid growth , interest rates tend to be low, production increases, and inflationary pressures build.
What must an economy do to increase the standard of living?
Faster growth in gross domestic product (GDP) expands the overall size of the economy and strengthens fiscal conditions. Broadly shared growth in per capita GDP increases the typical American’s material standard of living .
What is a factory building an example of?
A factory building is an example of which factor of production? Physical capital. Human-made objects used to create other goods and services are physical capital.
What is a person who consumes a good or service but does not pay for it?
A person who consumes a good or service but does not pay for it is called: a free rider.
What goal is difficult to achieve in a free market?
The goals of economic equity and economic security are difficult to achieve in a pure market system. How is a Centrally Planned Economy Organized? In a centrally planned economy, the central government rather than individual producers and consumers answer the key economic questions.
What are the pros and cons of a free market economy?
The lack of government control allows free market economies a wide range of freedoms, but these also come with some distinct drawbacks. Advantage: Absence of Red Tape. Advantage: Freedom to Innovate. Advantage: Customers Drive Choices. Disadvantage: Limited Product Ranges. Disadvantage: Dangers of Profit Motive.
How does a society decide who gets what goods and services?
The central government makes all decisions about the production and consumption of goods and services . economy economic decisions are made by individuals and are based on exchange, or trade. Each society determines who will consume what is produced based on? its unique combination of social values and goals.
What are the disadvantages and advantages of a market economy?
While a market economy has many advantages , such as fostering innovation, variety, and individual choice, it also has disadvantages , such as a tendency for an inequitable distribution of wealth, poorer work conditions, and environmental degradation.
Which of the following is the best example of a public good?
An example of a public good is: national defense. An economist would be most likely to argue that U.S. national defense should be funded through tax revenues because: individuals who refuse to contribute to a national defense fund cannot be excluded from benefiting from national defense.
In what kind of an economy does the government make all the decisions?
Which is a critical rule for determining whether something is a public good?
Which is a critical rule for determining whether something is a public good ? The benefit to each individual who uses the facility is greater than the cost. The benefits of the facility are greater for the society than for the individuals using it. The total benefits to society are greater than the total cost.