Price is information signaling how much potential value may be derived from consuming something.

Question

Quizplus · Accepted Answer

Price serves as an indicator of the value that can be obtained from consuming a particular product or service. It reflects the market's assessment of the benefits of that product or service, including its quality, availability, and other factors. As a result, the price conveys information about the potential value of the product and helps individuals and firms make decisions about how to allocate their resources.

Price Is Information Signaling How Much Potential Value May Be