When resources are allocated by markets, profits and losses provide information about

A. which products are priced too high and which are priced too low.

B. which resources are being used productively and which resources should be allocated to other uses.

C. which industries need to be subsidized and which need to be subject to additional regulation.

D. which businesses should be taxed more heavily and which should be subsidized.

Question

Business

Kathleen Welch

26 March, 15:37

When resources are allocated by markets, profits and losses provide information about

A. which products are priced too high and which are priced too low.

B. which resources are being used productively and which resources should be allocated to other uses.

C. which industries need to be subsidized and which need to be subject to additional regulation.

D. which businesses should be taxed more heavily and which should be subsidized.

+3

Answers (1)

Know the Answer?

Cornelius Fletcher · Answer 1

The correct answer is B. which resources are being used productively and which resources should be allocated to other uses.

Explanation:

The allocation of resources is the distribution of productive assets in their different uses.

The issue of resource allocation originates from how societies seek to balance limited resources such as capital, labor and land, in the face of the diverse and unlimited needs of its members. Resource allocation mechanisms cover the pricing system in free market economies and government planning, either in state-operated economies or in the public sector of mixed economies.

Gains and losses determine how effective a product / service is being in the market, and what actions can be taken to be able to route them correctly. In periods where there is a margin of sustained loss, it is necessary to revalue the relevance of the investment, because it can be channeled towards assets that generate value and therefore economic growth.