The Text States: ―The Great Economic Problem Is to Arrange

question 97

Multiple Choice

The text states: ―The great economic problem is to arrange our limited resources to satisfy as many of our limited wants as possible.‖ How does a market achieve this goal?

• A) It chooses central planners who are experts at identifying the best uses of resources.
• B) The forces of demand and supply use prices as a signaling device that direct resources to their highest value uses.
• C) It ensures that prices provide an even signal by making sure prices across all markets are equal.
• D) It offers resource-based futures contracts.

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Definitions:

Economic Inefficiency

A situation where resources are not allocated optimally, leading to waste or a failure to achieve potential output or welfare.

Indian Removal

A 19th-century policy of the United States government aimed at relocating Native American tribes from their ancestral lands in the eastern U.S. to territories west of the Mississippi River.

Colonization

The act of establishing control over the indigenous people of an area and exploiting it economically, often involving the settlement of one's own citizens into the territory.

American Society

The structure, culture, and norms of life in the United States, inclusive of its diverse populations, traditions, and values.