True or False? For a market to have a coordination mechanism, money must be exch

Question

True or False? For a market to have a coordination mechanism, money must be exchanged. Explain. False. Some markets don't have explicit prices. They have what are called "shadow prices"- prices paid under the table to avoid taxes. True. Although there are other ways to distribute goods and services, such as barter, only markets with money have coordination mechanisms. True. The coordination mechanism that economists recognize is the invisible hand. For the invisible hand to work, there must be an exchange of money. Other mechanisms do not truly coordinate desires and wants. False. Some markets don't have explicit prices. They have what are called "shadow prices." Economists have developed a way to convert opportunity costs into shadow prices regardless of whether money is exchanged.

Explanation / Answer

The correct answer is option A

The given statement is false since some markets dont have explicit policies. They have what are called as "Shadow Prices" - prices paid under the table to avoid taxes.

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