A weakness of the price system is that it completely fails to take account consumer preferences in the distribution of goods and services.

Question

Quizplus · Accepted Answer

The price system does take into account consumer preferences by reflecting them in the demand for goods and services, which in turn affects prices. Higher demand for a good or service results in a higher price, while lower demand leads to lower prices. Prices therefore allocate resources to the production of goods and services that are in demand by consumers.

A Weakness of the Price System Is That It Completely