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How Does the Invisible Hand Ensure That an Economy Will

Question 8

Multiple Choice

How does the invisible hand ensure that an economy will not run out of a renewable resource?


A) As resources run low, consumers will naturally decrease their demand for those resources.
B) Government will begin to regulate scarce resources as an effective means of rationing those resources.
C) If there is demand for those resources, producers will continue increasing supply regardless of price.
D) Price increases due to the diminishing supply of a resource will both curb consumption and provide incentive for producers to expand supply.

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