The market mechanism
A. Works through central planning by government.
B. Eliminates market failures created by government.
C. Works because prices serve as a means of communication between consumers and producers.
D. Is not a very efficient means of communicating consumer demand to the producers of goods and services.
Answer: C
You might also like to view...
In bank regulation in the United States there is a strong emphasis on
A) maximizing depositor returns. B) limiting depositor returns. C) maximizing depositor risk. D) limiting depositor risk.
Patents have been defended by some on the grounds that they stimulate inventive activity. Others have argued for changes in current patent laws because:
a. resources are misallocated by the grant of a patent monopoly b. patents may not be necessary to encourage inventive activity c. the current patent monopoly period (17 years) is too short to encourage any inventive activity. d. a and b only e. all of the above