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    2 days ago · The price mechanism plays three important functions in a market . 1/ Signalling function. Prices perform a signalling functionthey adjust to demonstrate where resources are required and where they are not Prices rise and fall to reflect scarcities and surpluses If prices are rising because of high demand from consumers this is a signal to suppliers to expand production to meet the

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    2 days ago · The price mechanism plays three important functions in a market . 1/ Signalling function. Prices perform a signalling functionthey adjust to demonstrate where resources are required and where they are not Prices rise and fall to reflect scarcities and surpluses If prices are rising because of high demand from consumers this is a signal to suppliers to expand production to meet the

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