Markets
The interaction between the buyers and sellers of a good or service is called a market. Two important economic markets are factor markets and product markets.
The factor market refers to the buying and selling of the factors of production. The factors of production (land, labor, capital, and entrepreneurship) are the resources used to produce goods and services.
Producers offer goods and services for sale in product markets. Individuals spend the money they have earned in the factor market (for instance, wages or the income from selling land) to make purchases in product markets.
Which statement is based on the text?
- A. Individuals spend their income in factor markets.
- B. Entrepreneurs profit from participation in product markets.
- C. Individuals sell their labor in factor markets.
- D. Resources are traded in product markets.
Correct Answer & Rationale
Correct Answer: C
Option C accurately reflects the concept that individuals offer their labor in factor markets, where resources like labor are exchanged for wages. This aligns with economic principles regarding labor supply. Option A is incorrect since individuals do not spend income in factor markets; rather, they purchase goods and services in product markets. Option B misrepresents the role of entrepreneurs, who primarily earn profits through innovation and sales in product markets, not simply from participation. Option D is also misleading, as resources are exchanged in factor markets, while product markets focus on the sale of finished goods and services.
Option C accurately reflects the concept that individuals offer their labor in factor markets, where resources like labor are exchanged for wages. This aligns with economic principles regarding labor supply. Option A is incorrect since individuals do not spend income in factor markets; rather, they purchase goods and services in product markets. Option B misrepresents the role of entrepreneurs, who primarily earn profits through innovation and sales in product markets, not simply from participation. Option D is also misleading, as resources are exchanged in factor markets, while product markets focus on the sale of finished goods and services.
Other Related Questions
Which statement from the passage is an opinion?
- A. "Even so, the success of Levittown depended not only on the efficiency of the Levitt brothers' process but also on the Federal Housing Administration" (paragraph 4)
- B. "Shortly after World War II, many changes led to the development of suburbs." (paragraph 1)
- C. "This, much of the baby-boom generation had well-constructed homes in which to grow up." (paragraph 4)
- D. "With this financing in place, more homes could be built and more veterans could afford to buy them." (paragraph 4)
Correct Answer & Rationale
Correct Answer: C
Option C expresses a subjective view about the quality of homes available to the baby-boom generation, indicating an opinion that these homes were "well-constructed." This characterization is not a factual statement and reflects a personal judgment. In contrast, Option A presents a factual statement about the factors contributing to Levittown's success, grounded in historical context. Option B provides a straightforward observation regarding the timeline of suburban development, without personal interpretation. Option D outlines a factual cause-and-effect relationship regarding financing and home construction, remaining objective. Thus, only Option C conveys a personal opinion.
Option C expresses a subjective view about the quality of homes available to the baby-boom generation, indicating an opinion that these homes were "well-constructed." This characterization is not a factual statement and reflects a personal judgment. In contrast, Option A presents a factual statement about the factors contributing to Levittown's success, grounded in historical context. Option B provides a straightforward observation regarding the timeline of suburban development, without personal interpretation. Option D outlines a factual cause-and-effect relationship regarding financing and home construction, remaining objective. Thus, only Option C conveys a personal opinion.
Which feature of the U.S. system of government did de Tocqueville believe might cause conflict in society?
- A. The majority is able to achieve special rights.
- B. The minority is able to block popular legislation.
- C. Legislators must represent minority interests.
- D. Legislators sometimes act against majority rule.
Correct Answer & Rationale
Correct Answer: A
De Tocqueville observed that when the majority in a democracy can impose its will, it might lead to the oppression of minority groups, creating societal conflict. This reflects his concern about "tyranny of the majority," where the dominant group's interests overshadow the rights of others. Option B is incorrect because while minorities can influence legislation, de Tocqueville focused more on majority power. Option C misrepresents his views; he acknowledged the importance of minority representation but did not see it as a source of conflict. Option D is also inaccurate, as de Tocqueville emphasized the potential for the majority to dominate rather than legislators opposing the majority.
De Tocqueville observed that when the majority in a democracy can impose its will, it might lead to the oppression of minority groups, creating societal conflict. This reflects his concern about "tyranny of the majority," where the dominant group's interests overshadow the rights of others. Option B is incorrect because while minorities can influence legislation, de Tocqueville focused more on majority power. Option C misrepresents his views; he acknowledged the importance of minority representation but did not see it as a source of conflict. Option D is also inaccurate, as de Tocqueville emphasized the potential for the majority to dominate rather than legislators opposing the majority.
Which technology mentioned in the passage was the first one invented by Edison?
- A. vote recorder
- B. motion-picture camera
- C. electric light bulb
- D. phonograph
Correct Answer & Rationale
Correct Answer: A
The vote recorder was the first technology invented by Edison, designed to streamline the voting process. This innovation predates his more famous inventions. The motion-picture camera (B) and electric light bulb (C) came later, showcasing Edison's evolution as an inventor. The phonograph (D), although significant in audio technology, was also developed after the vote recorder. Understanding the chronological order of these inventions highlights Edison's early contributions to technology and their impact on society.
The vote recorder was the first technology invented by Edison, designed to streamline the voting process. This innovation predates his more famous inventions. The motion-picture camera (B) and electric light bulb (C) came later, showcasing Edison's evolution as an inventor. The phonograph (D), although significant in audio technology, was also developed after the vote recorder. Understanding the chronological order of these inventions highlights Edison's early contributions to technology and their impact on society.
Which event occurred first?
- A. Michael moved to Ohio.
- B. Michael attained U.S. citizenship.
- C. The IRO was created.
- D. The UN was established.
Correct Answer & Rationale
Correct Answer: D
To determine the sequence of events, it’s essential to consider historical timelines. The United Nations (UN) was established in 1945, laying the groundwork for international cooperation. The International Refugee Organization (IRO) was created shortly after, in 1946, to address post-war refugee issues. Michael attaining U.S. citizenship likely occurred after these events, as it typically follows immigration processes. Lastly, Michael moving to Ohio would depend on his citizenship status and individual circumstances, making it the most recent event in this context.
To determine the sequence of events, it’s essential to consider historical timelines. The United Nations (UN) was established in 1945, laying the groundwork for international cooperation. The International Refugee Organization (IRO) was created shortly after, in 1946, to address post-war refugee issues. Michael attaining U.S. citizenship likely occurred after these events, as it typically follows immigration processes. Lastly, Michael moving to Ohio would depend on his citizenship status and individual circumstances, making it the most recent event in this context.