Can the market system lead to an efficient outcome in a market for a good like ice cream cones
A)no, because based on the market system alone, an inefficient number of ice cream cones will be produced
B)yes, because at the market equilibrium, the sum of producer surplus and consumer surplus is minimized
C)yes, because price adjusts to determine the supply and demand of the ice cream cones and determine the market equilibrium
D)no, because the price established in the market will not reflect the true value of ice cream cones to consumers

Question

Quizplus · Accepted Answer

In a market system, the price of a good like ice cream cones adjusts to determine the supply and demand. As a result, the market will reach equilibrium where the quantity supplied and the quantity demanded will be the same. This means that the market system can lead to an efficient outcome in a market for a good like ice cream cones. The equilibrium price will reflect the true value of ice cream cones to consumers and will ensure that an efficient number of ice cream cones will be produced.

Can the Market System Lead to an Efficient Outcome in a Market