Question

Who among the following gave the concept of time element in price determination process?

• A. Ricardo
• B. Walras
• C. Marshall
• D. Pigou

Hint:

Marshall’s distinction between the short-run and long-run supply curves is fundamental in understanding price determination over time.

Answer 1

The Correct Option is C

Step 1: Understanding the Concept of Time in Price Determination:
In economics, the concept of time plays a critical role in how prices are determined. It reflects how supply and demand factors adjust over time, and how markets reach equilibrium in the short and long run.
Step 2: Analyzing Economists:
- Ricardo: David Ricardo, known for his theory of comparative advantage, did not focus specifically on the time element in price determination.
- Walras: Leon Walras contributed to general equilibrium theory but did not emphasize time factors in price formation.
- Marshall: Alfred Marshall introduced the concept of time as an important factor in the price determination process, distinguishing between the short-run and long-run perspectives.
- Pigou: Arthur Pigou focused on welfare economics and externalities, but did not specifically address the time element in price determination.
Step 3: Conclusion:
Alfred Marshall is the economist who introduced the concept of time in price determination, making option (C) the correct answer.