The Market Solves the Information Problem When Allocating Resources By

question 130

Multiple Choice

The market solves the information problem when allocating resources by:

• A) collapsing all the relevant information about uses of the good into its price.
• B) collapsing all the relevant information about inputs of the good into the level of output.
• C) aggregating all the relevant information about the output of the good into the supply curve.
• D) aggregating all the relevant information about the output of the good into the demand curve.

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Definitions:

Chi-square Test

A statistical test used to determine if there's a significant difference between the expected frequencies and the observed frequencies in one or more categories.

Economic Concerns

Issues or problems relating to the economy, including unemployment, inflation, and economic policy.

Proportion

A fraction or percentage that represents a part of a whole or a total.

Test

An examination or evaluation conducted to determine the presence, quality, or truth of a specific characteristic, hypothesis, or condition.