Question

Why do prices have to be based on supply and demand, rather than cost? Question 25Answer a. Costs, unlike supply and demand, are based on subjective factors. b. People should be free to set whatever prices they prefer. c. People cannot be compelled to base prices on costs. d. Supply and demand determine costs. e. Because basing prices on costs is less efficient than basing prices on supply and demand.

Name: why do prices have to be based on supply and demand rather than cost question 25answer a costs unlike supply and demand are based on subjective factors b people should be free to set whateve 99934
Uploaded: 2022-08-19T09:55:57-08:00
Duration: 1 min 17 s
Channel: Sanchit Jain
Description: why do prices have to be based on supply and demand rather than cost question 25answer a costs unlike supply and demand are based on subjective factors b people should be free to set whateve 99934

          Why do prices have to be based on supply and demand, rather than cost?
Question 25Answer
a.
Costs, unlike supply and demand, are based on subjective factors.
b.
People should be free to set whatever prices they prefer.
c.
People cannot be compelled to base prices on costs.
d.
Supply and demand determine costs.
e.
Because basing prices on costs is less efficient than basing prices on supply and demand.

Added by David C.

Principles of Economics

Gregory Mankiw 8th Edition

Instant Answer

Solved by Expert Sanchit Jain

08/19/2022

Step 1

Step 1: Prices based on supply and demand reflect the actual value that consumers are willing to pay for a product or service, rather than just the cost of producing it. Show more…

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Why do prices have to be based on supply and demand, rather than cost? Question 25Answer a. Costs, unlike supply and demand, are based on subjective factors. b. People should be free to set whatever prices they prefer. c. People cannot be compelled to base prices on costs. d. Supply and demand determine costs. e. Because basing prices on costs is less efficient than basing prices on supply and demand.