Which of the Following Is a Problem with the Price

question 32

Multiple Choice

Which of the following is a problem with the price system that can lead to a breakdown in the coordination of economic activity?

• A) The price system works silently in the background.
• B) Prices can be slow to adjust.
• C) Prices may be flexible.
• D) all of the above

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Definitions:

Recession Risk

The probability of an economy experiencing a period of negative growth, leading to a decrease in employment, income, and production.

Department Stores

Large retail establishments that offer a wide variety of goods divided into departments for shoppers.

Inferior Goods

Products whose demand decreases as consumer income rises, opposite to what is observed with normal goods.

Substantial Performance

A legal concept indicating that a party has fulfilled enough of its contractual obligations to warrant payment, even if some minor specifications are not met.