What mechanism assures that firms produce outputs that consumers actually desire?
A)governmental regulations on the mix of outputs
B)altruism
C)the desire for profit
D)a desire to serve others without thought of reward
E)All of the above are correct.

Question

What mechanism assures that firms produce outputs that consumers actually desire?
A)governmental regulations on the mix of outputs 
B)altruism 
C)the desire for profit 
D)a desire to serve others without thought of reward 
E)All of the above are correct.

Quizplus · Accepted Answer

The desire for profit is the primary mechanism that assures that firms produce outputs that consumers actually desire. Firms aim to maximize their profits, which requires them to produce goods and services that consumers are willing to pay for. If they fail to meet consumer demands, they risk losing business to competitors and reducing their profitability. While governmental regulations and altruism may also influence firms' decisions, they are not as strong or consistent as the profit motive. The desire to serve others without thought of reward may exist in some firms but is not a reliable or sustainable mechanism for producing desired outputs.

What Mechanism Assures That Firms Produce Outputs That Consumers Actually