Question
Which of the following correctly illustrates how prices serve as signals to consumers?
A high price signals to consumers that the good is well-made.
A low price signals to consumers that they should buy a good.
A high price signals to consumers that they should buy a good.
A low price signals to consumers that the good is not well-made.
A high price signals to consumers that the good is well-made.
A low price signals to consumers that they should buy a good.
A high price signals to consumers that they should buy a good.
A low price signals to consumers that the good is not well-made.
Answers
GPT-4o mini
The correct option that illustrates how prices serve as signals to consumers is:
**A low price signals to consumers that the good is not well-made.**
This statement reflects the idea that lower prices may imply lower quality or less desirable goods, while higher prices can signal better quality or higher demand.
**A low price signals to consumers that the good is not well-made.**
This statement reflects the idea that lower prices may imply lower quality or less desirable goods, while higher prices can signal better quality or higher demand.