Which of the Following Statements About Markets and Prices Is

question 12

Multiple Choice

Which of the following statements about markets and prices is correct?

• A) In a market system, buyers and sellers must be in face-to-face contact with each other.
• B) Prices affect the distribution of goods in a market system, but not the allocation of resources.
• C) In a market system, prices serve to ration goods and services to consumers.
• D) The operation of a market system has little, if any, effect on the distribution of income in the economy.

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Definitions:

Heart Attack

A medical emergency that occurs when the flow of blood to the heart is blocked, causing heart muscle damage or death.

Normal Good

A type of good for which demand increases when consumer income rises, and decreases when consumer income decreases.

Rental Price

The cost associated with renting a property, such as an apartment or a car.

Normal Good

A type of good for which demand increases as the income of individuals or the economy increases.