The reason for making a payment for the goods that consumers consume.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 1, Problem 1Q

To determine

The reason for making a payment for the goods that consumers consume.

Expert Solution & Answer

Explanation of Solution

In an economy, most goods have limited supply whereas their wants are unlimited. That means the inputs that are used to produce most goods and services (for example, capital and labor), are more scarce than the quantity that consumers desire to consume.

Here in this case, the price acts as a rationing mechanism to prevent the over-usage of a particular scarce resource by making that resource available at the quantity where demand for that resource equals its supply. However, in the case where the price is zero for a particular scarce resource, it will be over-used as its demand will be higher than its supply.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Do you think that it is better to be efficient or to have a choice about prices, color, size, etc.? Why or why not? Do you feel that choices about a good help to offset the inefficiencies?

The difference between the price a consumer is willing to pay for a product and the price the consumer eventually pays is called?

Goods that satisfy humans wants though their direct use or consumption are called _______?

Answer 2

Question

Chapter 1, Problem 1Q

To determine

The reason for making a payment for the goods that consumers consume.

Expert Solution & Answer

Explanation of Solution

In an economy, most goods have limited supply whereas their wants are unlimited. That means the inputs that are used to produce most goods and services (for example, capital and labor), are more scarce than the quantity that consumers desire to consume.

Here in this case, the price acts as a rationing mechanism to prevent the over-usage of a particular scarce resource by making that resource available at the quantity where demand for that resource equals its supply. However, in the case where the price is zero for a particular scarce resource, it will be over-used as its demand will be higher than its supply.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 1, Problem 1Q

To determine

The reason for making a payment for the goods that consumers consume.

Expert Solution & Answer

Explanation of Solution

In an economy, most goods have limited supply whereas their wants are unlimited. That means the inputs that are used to produce most goods and services (for example, capital and labor), are more scarce than the quantity that consumers desire to consume.

Here in this case, the price acts as a rationing mechanism to prevent the over-usage of a particular scarce resource by making that resource available at the quantity where demand for that resource equals its supply. However, in the case where the price is zero for a particular scarce resource, it will be over-used as its demand will be higher than its supply.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 1, Problem 1Q

To determine

The reason for making a payment for the goods that consumers consume.

Expert Solution & Answer

Explanation of Solution

In an economy, most goods have limited supply whereas their wants are unlimited. That means the inputs that are used to produce most goods and services (for example, capital and labor), are more scarce than the quantity that consumers desire to consume.

Here in this case, the price acts as a rationing mechanism to prevent the over-usage of a particular scarce resource by making that resource available at the quantity where demand for that resource equals its supply. However, in the case where the price is zero for a particular scarce resource, it will be over-used as its demand will be higher than its supply.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 1, Problem 1Q

To determine

The reason for making a payment for the goods that consumers consume.

Expert Solution & Answer

Explanation of Solution

In an economy, most goods have limited supply whereas their wants are unlimited. That means the inputs that are used to produce most goods and services (for example, capital and labor), are more scarce than the quantity that consumers desire to consume.

Here in this case, the price acts as a rationing mechanism to prevent the over-usage of a particular scarce resource by making that resource available at the quantity where demand for that resource equals its supply. However, in the case where the price is zero for a particular scarce resource, it will be over-used as its demand will be higher than its supply.

Answer 6

Chapter 1, Problem 1Q

To determine

The reason for making a payment for the goods that consumers consume.

Expert Solution & Answer

Explanation of Solution

In an economy, most goods have limited supply whereas their wants are unlimited. That means the inputs that are used to produce most goods and services (for example, capital and labor), are more scarce than the quantity that consumers desire to consume.

Here in this case, the price acts as a rationing mechanism to prevent the over-usage of a particular scarce resource by making that resource available at the quantity where demand for that resource equals its supply. However, in the case where the price is zero for a particular scarce resource, it will be over-used as its demand will be higher than its supply.

Answer 7

Chapter 1, Problem 1Q

To determine

The reason for making a payment for the goods that consumers consume.

Answer 8

Expert Solution & Answer

Explanation of Solution

In an economy, most goods have limited supply whereas their wants are unlimited. That means the inputs that are used to produce most goods and services (for example, capital and labor), are more scarce than the quantity that consumers desire to consume.

Here in this case, the price acts as a rationing mechanism to prevent the over-usage of a particular scarce resource by making that resource available at the quantity where demand for that resource equals its supply. However, in the case where the price is zero for a particular scarce resource, it will be over-used as its demand will be higher than its supply.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Ch. 1 - Prob. 1Q Ch. 1 - Prob. 2Q Ch. 1 - Prob. 3Q Ch. 1 - Prob. 4Q Ch. 1 - Prob. 5Q Ch. 1 - Prob. 6Q Ch. 1 - Prob. 7Q Ch. 1 - Prob. 8Q Ch. 1 - Prob. 9Q Ch. 1 - Prob. 10Q

The reason for making a payment for the goods that consumers consume.

The reason for making a payment for the goods that consumers consume.

Explanation of Solution

Want to see more full solutions like this?

Chapter 1 Solutions