If Price Is a Signal in a Market Economy, What

question 40

Multiple Choice

If price is a signal in a market economy, what signal does it send to producers when the price of oil goes up?

• A)suppliers should produce more gasoline.
• B)buyers should purchase even more gasoline.
• C)government should decrease taxes on gasoline.
• D)government should place price controls on the market for gasoline.
• E)suppliers should produce less gasoline.

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Definitions:

Curare

A plant extract used by South American indigenous peoples on arrows and darts for hunting, which acts as a muscle relaxant by blocking neurotransmission.

Physostigmine

Physostigmine is a reversible cholinesterase inhibitor used medically to increase acetylcholine levels in the treatment of certain disorders, such as glaucoma and myasthenia gravis.

Poison Arrowheads

Historical weapons used for hunting and warfare, often coated with natural toxins to incapacitate or kill the target.

Acetylcholine

A neurotransmitter involved in many functions including muscle activation, memory, and learning.