In a freely operating market system, queuing is most likely to occur when
A) selling necessities.
B) the market clearing price increases.
C) demand fluctuates unpredictably and quickly.
D) demand increases gradually over time.

Question

Quizplus · Accepted Answer

Queuing occurs when there is a sudden and unpredictable increase in demand, as people rush to purchase a particular good or service. In a freely operating market system, prices should adjust to clear the market, so they are unlikely to cause queuing. Gradual increases in demand can be accommodated by suppliers planning for increased production, so queuing is unlikely to occur. However, if demand fluctuates unpredictably and quickly, it may be difficult for suppliers to adjust, resulting in queuing. Selling necessities may lead to high demand, but if suppliers are able to anticipate this demand and adjust production accordingly, queuing may be avoided.

In a Freely Operating Market System, Queuing Is Most Likely