Why is the best price the particular price that results in quantity supplied being equal to quantity demanded
A)It maximizes sellers' costs.
B)It maximizes profit for buyers.
C)It maximizes the total welfare of buyers and sellers.
D)It minimizes the expenditure of buyers.

Question

Quizplus · Accepted Answer

The best price is the one that results in quantity supplied being equal to quantity demanded because it maximizes the total welfare of both buyers and sellers. This is because when supply and demand are in equilibrium, the price signals that the market has allocated resources efficiently and that there are no shortages or surpluses, leading to a fair distribution of benefits to both buyers and sellers. The other options are not correct because maximizing sellers' costs (A) or buyers' profit (B) does not consider the welfare of both parties in the market, and minimizing buyers' expenditure (D) does not necessarily lead to an efficient allocation of resources or a fair distribution of benefits.

Why Is the Best Price the Particular Price That Results