AP Economics Chapter 2 Review Questions In a competitive market

AP Economics
Chapter 2 Review Questions
In 1996 McDonald's introduced its
Arch Deluxe hamburger, which failed
to catch on with the public and was
subsequently dropped from the
menu. This failure illustrates the idea
The market system's answer to the
fundamental question "How will the
goods and services be produced?" is
In a competitive market economy
firms will select the least-cost
production technique because:
"With as much machinery
as possible."
such choices will result in
the full employment of
available resources.
technological change.
"Using the latest
to do so will maximize the
firms' profits.
downsloping demand.
"By exploiting labor."
"Using the least-cost
production techniques."
this will prevent new firms
from entering the industry.
consumer sovereignty.
"dollar voting" by
consumers mandates such
a choice.