Which best states the passage's position?

Prices carry scattered knowledge efficiently, but stay silent about costs no one is charged for. (The passage praises the price signal for two paragraphs, then names its limit, and refuses both worship and dismissal at the end.)

According to the passage, what do manufacturers do when the price of tin rises?

They substitute metals, redesign joints, and salvage scrap. (The first paragraph lists exactly these three responses, and adds that none of them needs the story behind the number.)

The passage implies that a central planner's deepest problem is that

the knowledge needed is scattered and often never put into words (The text says the knowledge exists nowhere in summary form, is tacit, and is only revealed in the act of trading.)

As used here, "tacit" describes knowledge that is

held by someone without being put into words (It sits beside "barely expressible by the person holding it", so tacit knowledge is real but unspoken.)

What A Price Knows: Level 5 Reading Comprehension Questions

Consider the tin inside a soldering iron. Suppose a mine floods and the world supply of tin falls. No committee announces this. Yet within days the price rises, and thousands of manufacturers who have never heard of that mine begin, quietly, to economize: substituting other metals where they can, redesigning a joint, salvaging scrap they used to throw away. Each of them acts on a single number. None of them needs the story behind it.

This is the argument that a price is not merely a cost but a message. The knowledge required to run an economy, who has a spare warehouse, which machine sits idle, what a customer will tolerate, exists nowhere in summary form. It is scattered across millions of heads, much of it tacit, some of it barely expressible by the person holding it. A planner cannot gather what is only revealed in the act of trading.

The claim is powerful, and it is also incomplete. Prices are mute about anything nobody is charged for: polluted air, an emptied fishery, a road worn thin by trucks. The signal is real, but it carries only what the market has been made to count.

The honest conclusion is neither worship nor dismissal. Prices are a remarkable instrument with a known blind spot.

Comprehension questions