Which of the following is an essential part of the market mechanism?
A) Changing relative prices
B) Constant prices
C) Falling average prices
D) Rising average prices

Question

Quizplus · Accepted Answer

Changing relative prices is an essential part of the market mechanism, as it signals information to producers and consumers about the scarcity or abundance of goods and services. This information helps to allocate resources efficiently and leads to the best use of resources in the economy. Constant prices, falling average prices, or rising average prices do not necessarily play a role in the market mechanism.

Which of the Following Is an Essential Part of the Market