146. An important part of the market system is that producers and consumers consider the public inte

146. An important part of the market system is that producers and
consumers consider the public interest in making production and consumption
decisions.

147. Economic rivalry, or
competition, requires a large number of buyers and sellers in the market.

148. More specialization
in a market economy generally leads to the more efficient use of its resources.

149. A division of labor
enhances society’s output by permitting people to take advantage of existing
differences in their abilities and skills.

150. Exchange by barter
requires a coincidence of wants.
151. One of the most
important economic resources is money.

152. The return, or
factor payment, to suppliers of property resources is called profit.

153. If economic profit
exists in an industry, resource suppliers will be enticed into expanding the
industry.

154. The concept of
consumer sovereignty refers to situations in which consumers are represented on
the board of directors of large corporations.

155. Economic efficiency
entails getting the smallest amount of output from a given level of input of
scarce resources.

156. In the market
system, prices tend to guide resources from less important to more important
uses as the market system accommodates change.

157. In a competitive
market economy, firms and resource suppliers will seek to further their own
self-interest, but at the same time, as if guided by an “invisible
hand,” they will promote the public interest.

158. It is generally
agreed that a major advantage of the competitive price system is the
achievement of efficiency.

159. The problems of
central planning become more complex as an economy grows over time.

160. Profit, but not
price, is the primary success indicator in a centrally planned economy.

161. The coordination
problem in the economy of the former Soviet Union and pre-reform China involved
the difficulties of matching the inputs and outputs of industrial enterprises.

162. In the circular flow
model, households function on the selling side of the resource market and the
buying side of product markets.

163. In the circular flow
model, there is a money flow of economic resources and finished goods and
services and a real flow of income and consumption expenditures.