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JAMB Economics 2013 Question 19

Question 19

Economic Systems

One of the criticisms of the price mechanism is that

  1. A.producers are sovereign.
  2. B.it provides low degree of freedom.
  3. C.it widens the inequitable gap.
  4. D.consumers are sovereign.
Show the answer and explanation

Answer: C (it widens the inequitable gap.)

Explanation

Under the price mechanism goods go to those who can pay, so the rich get richer and income inequality widens.