Assume there is a reduction in the shipments of petroleum products due to political tension in the Persian Gulf.In a market economy,which consumers would get the reduced supplies of gas?

Question

Quizplus · Accepted Answer

In a market economy, the reduced supplies of gas would go to the consumers who value it the most and are able to pay the higher price. This is because the market forces of demand and supply would lead to an increase in the price of gasoline and hence only those who can afford it would be able to buy it. This is the basic principle of a market economy where the price determines the allocation of goods and services.

Assume There Is a Reduction in the Shipments of Petroleum