In a competitive market economy, a resource in short supply will be allocated

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In a competitive market economy, resources in short supply will be allocated to those firms that can make the most profitable use of them. This is because firms that can generate greater profits from a limited resource will be willing to pay a higher price for it, which will in turn provide an incentive for suppliers to allocate the resource to those firms. This process leads to an efficient allocation of scarce resources in a market economy.

In a Competitive Market Economy, a Resource in Short Supply