The allocative function of price cannot operate unless there is:
A)a significant barrier to entry.
B)both free entry and free exit.
C)either free entry or free exit.
D)neither free entry nor free exit.

Question

Quizplus · Accepted Answer

The allocative function of price requires both free entry and free exit to ensure resources are efficiently allocated in response to changes in demand and supply.

The Allocative Function of Price Cannot Operate Unless There Is