In a free market?
Correct answer: D. Prices adjust to reconcile scarcity and desires
- A. government intervenes
- B. government plan production
- C. government interferes
- D. Prices adjust to reconcile scarcity and desires
Explanation
In a free market, prices change in response to shortages, surpluses, and consumer demand. These price adjustments coordinate scarce resources with people’s desires without central government planning.
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About Microeconomics
Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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