Economics Interview Question:

What are the advantages of leaving the allocation of a countrys resources to the price mechanism?

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The main conditions required are:

1. Either a finite number of agents or goods.

2. No externalities - That is, the consumption of one person should not harm or benefit anyone else.

3. No matter how much a person is consuming, they must be able to be made slightly happier by consuming a bit more of something.
Submitted by: Administrator