Question

In the 1990s thousands of "dot-com" companies emerged with great fanfare to take advantage of the Internet and new information technologies. A few, like eBay, and Amazon, generally thrived and prospered, but many others struggled and eventually failed. The market system answers the question "What goods and services will be produced?"

The operation of the market can explain the varied outcomes of these "dot-com" companies because

a. new regulations were passed, creating proft expectations; new firms entered; prices fell; and most firms failed.
b. consumers experienced windfalls, creating low proft expectations; new firms entered; prices fell; and some firms failed.
c. shareholders experienced windfalls, creating proft expectations; new firms entered; prices fell; and some firms failed.
d. shareholder restrictions were passed, lowering proft expectations; new firms entered; prices fell; and some firms failed.

Answer 1

The varied outcomes of the "dot-com" companies in the 1990s can be explained by the operation of the market in a market economy. In this case, the correct answer is a. New regulations were passed, creating profit expectations; new firms entered; prices fell; and most firms failed.

Step-by-step explanation:

The varied outcomes of the "dot-com" companies in the 1990s can be explained by the operation of the market in a market economy. In this case, the correct answer is a. New regulations were passed, creating profit expectations; new firms entered; prices fell; and most firms failed.

In a market economy, companies can succeed or fail due to factors such as regulations, competition, and market shifts. In the case of the "dot-com" companies, new regulations and increased competition led to a decrease in prices and ultimately the failure of most firms.