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Producers automatically produce more of what is earning profit.

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The most important role of prices is to guide resources to their most efficient use.

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Prices give markets the flexibility they need to reach equilibrium even under changing conditions.

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Prices help markets to adjust quickly when events like wars and natural disasters interfere with the production of goods.

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Changing prices motivate producers.
Prices in the form of wages and salaries motivate workers.

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Prices are an incentive because they represent potential for profit.

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To consumers, price shows the opportunity cost of a purchase.
Prices tell producers what the consumer wants.

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Prices send a signal.
Consumers and producers use this information to make decisions.

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Prices Allocate Scarce Resources Efficiently

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Prices Allocate Scarce Resources Efficiently

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Prices Allow Markets to Respond to Changing Conditions

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Prices Allow Markets to Respond to Changing Conditions

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Prices Create Incentives to Work and Produce

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Prices Create Incentives to Work and Produce

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Prices Convey Information to Consumers and Producers

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Prices Convey Information to Consumers and Producers