--%>
Assignment Help - homework help

Signals that guide economic decisions

In market economies, what are the signals which guide economic decisions?

E

Expert

Verified

In market economies, prices are the signals which guide economic decisions and thus allocate scarce resources. For each and every good in the economy, the price makes sure that supply and demand are in balance. The equilibrium price then finds out how much of the good buyers chooses to buy and how much sellers select to produce.

   Related Questions in Macroeconomics

  • Q : Value of imports of goods The country’s

    The country’s balance of trade is Rs.500 crores. The value of exports of goods is Rs. 650 crores. What is the value of imports of goods?

    		•
  • Q : Business cycle What is meant by the

    What is meant by the term business cycle as described by economists?

    		•
  • Q : Explain reason why land Land, capital

    Land, capital and labor are all scarce since: (1) advertising mainly over stimulates human wants. (2) once employed they cannot be used again. (3) each productive resource needs a monetary return for its employ. (4) inheritance under a capitalism prot

    		•
  • Q : Difference between

    Elucidate the differences among the frictional, structural, and cyclical forms of unemployment.

    		•
  • Q : Economics I help with part 2 and the 4

    I help with part 2 and the 4 part question.

    		•
  • Q : Weighed marginal cost and marginal

    Cite examples of recent decisions that you made in which you, at least implicitly, weighed marginal cost and marginal benefit?

    		•
  • Q : Shortage of the good Describe when

    Describe when there will be a shortage of the good?

    		•
  • Q : Definition of surplus Definition of

    Definition of surplus: It is a condition in which quantity supplied is more than quantity demanded. To remove the surplus, producers will minimize the price till the market reaches to equilibrium.

    		•
  • Q : Maximizing consumer utility The

    The consumer maximizes the utility whenever spending patterns causes: (i) Total outlays to increase each time prices are altered. (ii) Marginal utilities of each and every good consumed to be equivalent. (iii) Marginal utilities from the last cent spent on each and ev

    		•
  • Q : Difference between APC and MPC

    Differentiate between APC and MPC. The value of which of them can be greater than another and when? Answer: APC is the average

    		•