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

question 56

Multiple Choice

The text states: ―The great economic problem is to arrange ourlimited resources to satisfy as many of our limited wants aspossible.‖ 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.(True
• Answer )Correct
• 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:

Detection Threshold

The minimum level of stimulus intensity required for a sensory system to detect a stimulus 50% of the time.

Sensory Overload

A condition in which one or more of the body's senses experiences over-stimulation from the environment, leading to feelings of overwhelmedness or inability to focus.

Perceptual Adaptation

The ability of the brain to adjust to changes in the sensory environment, allowing for maintained perception under different conditions.

Perceptual Overload

A condition resulting from the exposure to more information or stimuli than one can effectively process at one time.