A Friend of Yours Asks You Why Market Prices Are

Multiple Choice

A friend of yours asks you why market prices are better than government-determined prices.Because you understand economic principles,you say that market-determined prices are better because they generally reflect

A) the value of a good to society,but not the cost of making it.
B) the cost of making a good to society,but not its value.
C) both the value of a good to society and the cost of making it.
D) neither the value of a good to society nor the cost of making it.