After a natural disaster, such as a hurricane, the increased demand for certain items (like lumber, electric generators, and chainsaws) causes their prices to rise. These higher prices
A) discourage the flow of these items into the area.
B) encourage consumers to purchase the items even if they do not plan to use them.
C) help to direct the items toward their highest valued uses.
D) do all of the above.

Question

Quizplus · Accepted Answer

Higher prices signal scarcity and help allocate resources efficiently by directing them to where they are most needed, ensuring that those who value them most highly are more likely to obtain them.

After a Natural Disaster, Such as a Hurricane, the Increased