Responses
The government should intervene to protect consumers.
The government should intervene to protect consumers.
Producers should supply more and consumers should buy less.
Producers should supply more and consumers should buy less.
Producers should supply less and consumers should buy less.
Producers should supply less and consumers should buy less.
Producers should supply less and consumers should buy more.
Producers should supply less and consumers should buy more.
1 answer
In a free market economy, high prices send the signal that producers should supply more and consumers should buy less.
This is because high prices typically indicate strong demand relative to supply, incentivizing producers to increase their output to capitalize on the opportunity for greater profit, while consumers may reduce their quantity demanded due to the higher price.
