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Microeconomics, 10e (Parkin)
Chapter 5 Efficiency and Equity
1 Resource Allocation Methods
1) In the United States, resources are most often allocated by
A) market price.
B) command system.
C) lottery.
D) contest.
Answer: A
Topic: Resource Allocation Methods
Skill: Recognition
Question history: Previous edition, Chapter 5
AACSB: Reflective Thinking
2) A contest is a good way to allocate scarce resources when
A) the efforts of the players are hard to monitor directly.
B) the lines of responsibility are clear.
C) the decision being made affects a large number of people.
D) there is no effective way to distinguish among potential users.
Answer: A
Topic: Resource Allocation Methods
Skill: Conceptual
Question history: Previous edition, Chapter 5
AACSB: Reflective Thinking
3) The resource allocation method that is used to allocate scarce resources between private use and government use is
A) first-come, first-served.
B) personal characteristics.
C) majority rule.
D) lottery.
Answer: C
Topic: Resource Allocation Methods
Skill: Conceptual
Question history: Modified 10th edition
AACSB: Reflective Thinking
4) Which of the following is true?
A) Lotteries work best when a resource can serve just one user at a time in a sequence.
B) A market price always allocates resources better than does a command system.
C) When the government decides how to allocate tax dollars among competing uses, resources are allocated by majority rule.
D) Force has never played an important role in allocating scarce resources.
Answer: C
Topic: Resource Allocation Methods
Skill: Conceptual
Question history: Previous edition, Chapter 5
AACSB: Reflective Thinking
5) Which of the following is true?
A) When resources are allocated on the basis of personal characteristics, all people who are willing and able to pay the price get the resource.
B) When the range of activities to be monitored is large and complex, a command system allocates resources better than a market price.
C) Wh
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