Which of the following statements is correct?
A)Low prices may not always be in the public interest.
B)If prices on scarce resources are set "too low," consumers will receive the "wrong" signals and be encouraged to consume more, thus squandering resources.
C)Raising prices on scarce resources is generally politically unpopular.
D)All of the responses are correct.

Question

Quizplus · Accepted Answer

All of the responses are correct.

A) Low prices can lead to overconsumption or underproduction of goods, which can be detrimental to the public interest in the long run. 
B) If prices are too low, it does not accurately reflect the scarcity of the resource, leading to wasteful consumption patterns. 
C) Raising prices on scarce resources is often difficult politically, as it can lead to consumer backlash and criticism of the government or businesses.

Which of the Following Statements Is Correct