Rationing through the price system
A) leads to an inefficient use of available resources.
B) leads to high prices.
C) works only with government interference.
D) leads to an efficient use of available resources.

Question

Quizplus · Accepted Answer

Rationing through the price system allows goods and services to be allocated based on how much individuals are willing and able to pay for them. This leads to an efficient use of available resources as it ensures that those who value the goods or services the most will have access to them. It also incentivizes producers to allocate resources to the production of the goods that are most highly valued by consumers. While prices may be high in some cases, they reflect the true cost of producing the goods or services and provide information to consumers about their value. This works without the need for government interference, as the market forces of supply and demand determine the price levels.

Rationing Through the Price System