Economics 9708 · AS & A Level · Resource allocation in different economic systems

Resource allocation in different economic systems — practice question

What is an important role of the price mechanism?

  • Aproviding incentive for government intervention to reduce income inequality
  • Bremoving shortages by creating incentives for market prices to fall
  • Cremoving surpluses by creating incentives for market prices to rise
  • Dsignalling changes in market conditions to producers and consumers

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