price (2.4)

Question 1

what is price

Answer 1

the sum of money you have to pay for a good or service. it is determined by the interaction of supply and demand.

Question 2

what is efficiency

Answer 2

the optimal production and distribution of scarce resources

Question 3

what is signalling

Answer 3

prices change to signal where resources are needed.if prices rise this shows that more resources are required.

Question 4

what is rationing

Answer 4

prices help ration scarce resources.

Question 5

what is equilibrium price and quantity

Answer 5

where the quantity supplied exactly matches the quantity demanded

Question 6

what is the determination of price

Answer 6

the interaction of the free market forces of demand and supply to establish the general level of price for a good or service

Question 7

what is the allocation of resources

Answer 7

how scarce resources are distributed among producers, and how scarce goods and services are allocated among consumers.

Question 8

excess supply

Answer 8

bigger section over the equilibrium of supply and demand

Question 9

excess demand

Answer 9

bigger section below the equilibrium of supply and demand

Question 10

what are market forces

Answer 10

factors that determine price levels and the availability of goods and services in an economy without government intervention