Which of the following signals to the owners of scarce resources are the best uses of those resources?
A)profits of businesses.
B)government regulations.
C)economic indicators.
D)the accounting cost of those resources.

Question

Quizplus · Accepted Answer

Profits of businesses signal to owners of scarce resources that their resources are being allocated efficiently and effectively in the marketplace. This is because profits indicate that there is demand for the goods or services being produced and that consumers are willing to pay for those goods or services at a price that covers the cost of production and generates a profit for the business. In turn, owners of scarce resources can invest more in the businesses that are generating profits and withdraw resources from those that are not. This process ensures that resources are allocated towards the production of goods and services that are valued by consumers and that generate economic growth.

Which of the Following Signals to the Owners of Scarce