Principles of Microeconomics / Unit 2 MIC 0137 short lesson, about 20 seconds
Prices Carry Information
Captions available
The idea
A price is a signal. When a frost cuts the coffee crop, the higher price tells every buyer to economize and every grower to plant, with no one issuing instructions.
In practice
Seasonal produce prices move diets every year without a committee.
Where people slip
Markets answer what, how and for whom through prices. Blocking the price with a control also blocks the information it carried.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
Builds on
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