In a market-based economy, scarce resources are allocated by

Question

Quizplus · Accepted Answer

In a market-based economy, the price system is used to allocate scarce resources. The price system is based on the interplay of supply and demand in the marketplace, with prices reflecting the relative scarcity and value of goods and services. As demand for a particular good or service increases, the price will also increase, signaling to producers that they should produce more to meet demand. Conversely, if there is a surplus of a particular good or service, the price will decrease, signaling to producers that they should produce less. This system allows for the efficient allocation of resources based on consumer demand and producer supply.

In a Market-Based Economy, Scarce Resources Are Allocated by