What Happens When the Government Prevents Prices from Adjusting Naturally

question 170

Multiple Choice

What happens when the government prevents prices from adjusting naturally to supply and demand?

• A) It stabilizes the economy by reducing market uncertainties.
• B) It adversely affects the allocation of resources.
• C) There is an improvement in equity that justifies the reduction in efficiency.
• D) There is an improvement in efficiency that justifies the reduction in equity.

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Definitions:

Effective Communication

The ability to convey information or ideas in a clear, concise, and meaningful way that is understood by the audience.

Technical Skills

Specific abilities or knowledge related to the use of technology, machinery, software, or procedures, essential in various industries.

Entrepreneur

An individual who initiates, designs, and runs a new business venture, often taking on financial risks in the hope of profit.

Informal Tone

A casual or conversational style of communication, often characterized by personal pronouns, contractions, and direct address.