If one adopts a pure free-market approach to depletable resources, then one can expect the price of resources to
A)rise steadily.
B)fall steadily.
C)fluctuate in a random-walk fashion.
D)remain unchanged.

Question

Quizplus · Accepted Answer

According to the law of supply and demand, as demand for a depletable resource increases and its supply decreases, the price of the resource will rise steadily. This is due to the scarcity of the resource and the competition among buyers who are willing to pay a higher price to secure their access to it.

If One Adopts a Pure Free-Market Approach to Depletable Resources