The Price System Functions Most Effectively When

question 34

Multiple Choice

The price system functions most effectively when

• A) supply equals demand.
• B) there is no divergence between private costs and social costs.
• C) prices equal output.
• D) external diseconomies equal external economies.
• E) there is a complete absence of direct regulation.

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Definitions:

Noticeable Threshold

A threshold is the level at which a stimulus becomes sufficiently strong to produce a discernible effect or reaction.

Range Threshold

The minimum and maximum values within which a particular sensory stimulus, action, or phenomenon is perceptible or has an effect.

Receptors

Protein molecules on the surfaces of dendrites and cell bodies that have distinctive shapes and will interact only with specific neurotransmitters.

Activation

in psychology, refers to the arousal level of the central nervous system, influencing alertness and responsiveness to stimuli.