In a market economy, ________ allows most prices to rise and fall to reflect the forces of supply and demand.
A) free choice
B) free enterprise
C) price flexibility
D) laissez-faire

Question

Quizplus · Accepted Answer

Price flexibility allows prices to rise and fall in response to changes in supply and demand. This pricing mechanism helps allocate resources efficiently based on market demand. Free choice and free enterprise refer to the ability of individuals to make their own economic decisions and engage in entrepreneurial activities, while laissez-faire refers to a hands-off approach to government intervention in economic affairs. While important in a market economy, these concepts are not directly related to the pricing mechanism of supply and demand.

In a Market Economy, ________ Allows Most Prices to Rise