Question
Which of the following principles of a free enterprise system can explain why a business will have problems if it tries to set prices too high in a well-established market?(1 point)
Responses
open opportunity
open opportunity
voluntary exchange
voluntary exchange
property rights
property rights
profit
Responses
open opportunity
open opportunity
voluntary exchange
voluntary exchange
property rights
property rights
profit
Answers
GPT-4o mini
The principle that can explain why a business will have problems if it tries to set prices too high in a well-established market is **voluntary exchange**.
In a free enterprise system, consumers have the choice to buy or not to buy products at the prices set by businesses. If a business sets its prices too high, consumers may choose not to purchase from that business and instead look for alternatives, resulting in a loss of sales and potentially driving the business into financial trouble. Voluntary exchange relies on the idea that both parties (buyers and sellers) agree on a price that they find acceptable; if that price is too high, the exchange will not occur.
In a free enterprise system, consumers have the choice to buy or not to buy products at the prices set by businesses. If a business sets its prices too high, consumers may choose not to purchase from that business and instead look for alternatives, resulting in a loss of sales and potentially driving the business into financial trouble. Voluntary exchange relies on the idea that both parties (buyers and sellers) agree on a price that they find acceptable; if that price is too high, the exchange will not occur.