Question

Which of the following best describes how consumers let producers know

Answer 1

The correct answer is D. The purchases consumers make indicate their desires to producers.

Explanation:

In the economy, it is common goods and services adapt to the desires of consumers or demand, this occurs because the products or services available (supply) should fulfill the needs and desires of consumers; otherwise, these would not be sold and producers will not obtain a profit. Additionally, the main way producers know the consumer's desires to adjust production and price is by analyzing the purchases of consumers because these indicate their desires as well as the types of products they like or how much they want to pay.

For example, if a company releases two new cellphones, and over time they find cellphone A is preferred by most consumers, then the company knows the features of cellphone A are desired by consumers; therefore, they should increase the production of this cellphone or similar ones, and also they can sell it at a higher price.