What mechanism assures that producers use inputs efficiently?
A)governmental regulations on use of resources
B)altruism
C)the desire for profit
D)an innate desire to be efficient
E)All of the above are correct.

Question

What mechanism assures that producers use inputs efficiently?
A)governmental regulations on use of resources 
B)altruism 
C)the desire for profit 
D)an innate desire to be efficient 
E)All of the above are correct.

Quizplus · Accepted Answer

The desire for profit is the primary mechanism that assures producers use inputs efficiently. Producers aim to minimize their costs, so they will use inputs efficiently to maximize their profits. Governmental regulations can also encourage efficient use of resources, but they are not the primary mechanism. Altruism and an innate desire to be efficient may play a role in some cases, but they are not reliable enough to ensure widespread efficient use of resources.

What Mechanism Assures That Producers Use Inputs Efficiently