Intro to Econ Microeconomics (ECON-1102-005) Assignment #1 (10%), Due January 26, 2024, 5 PM. c. She should complete the repairs and sell the cabin. d. It doesn't matter which action she takes; the outcome 1s the same either way. 8. In a market economy, what guides economic activity? a. the government b. businesses c. central planners d. prices 9. To what extent does the invisible hand model of a market ensure equity and efficiency? a. The invisible hand always ensures both equity and efficiency. b. The invisible hand cannot ensure either equity or efficiency. c. The invisible hand is more effective at ensuring efficiency than it is at ensuring equity. d. The invisible hand is more effective at ensuring equity than it is at ensuring efficiency. 10. What is a primary function of prices in a market economy? a. to provide participants with economic information b. to provide participants with spending limits c. to provide participants with accounting capabilities d. to provide participants with an equitable distribution of goods 11. What is one necessary role of government in a market economy? a. to tax goods and services that are most desired by consumers b. to maintain subsidized housing for low-income houscholds c. to provide services such as pensions d. to enforce property rights 12. What would happen without the govemment's protection of property rights? a. Businesses would have less incentive to provide goods and services. b. There would be less government regulation of businesses and prices would be lower for consumers. c. Taxes would be lower, causing less market inefficiencies. d. Businesses would have more freedom with production processes. 13. A worker in Bangladesh can eam $1 per day making cotton cloth on a handloom. A worker in Canada can earn $100 per day making cotton cloth with a mechanical loom. What accounts for the difference in wages? a. Canadian textile workers belong to a union. b. There is little demand for cotton cloth in Bangladesh and great demand in Canada. c. Labour is more productive making cotton cloth with a mechanical loom than with a hand loom. d. Bangladesh has a low-wage policy to make its textile industry more competitive in world markets. 14. What is almost always the cause of large or persistent inflation? a. an increase in demand for domestic production b. growth in the quantity of money c. foreign competition d. higher worker productivity