The adjustment of the ____________ is the rationing mechanism in market economies.

A) price
B) competition
C) government
D) None of the choices are correct.

Question

The adjustment of the ____________ is the rationing mechanism in market economies.A) priceB) competitionC) governmentD) None of the choices are correct.

Naima Kinng · Accepted Answer

Final Answer : A, Explanation :  In market economies, prices serve as the rationing mechanism because they determine how much of a good or service is produced and consumed. As the price of a good or service increases, consumers will demand less of it, and producers will supply more of it, resulting in a more efficient allocation of resources. Similarly, if the price of a good or service decreases, consumers will demand more of it, and producers will supply less of it, which also leads to a more efficient allocation of resources. Therefore, the adjustment of prices is the key mechanism in allocating resources in market economies.

The adjustment of the ____________ is the rationing mechanism in market economies.

A) price
B) competition
C) government
D) None of the choices are correct.

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