In a market economy, the decisions about what to produce and how much of each good or service to produce are made by

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In a market economy, the decisions about what to produce and how much of each good or service to produce are made by consumers and producers. Consumers determine what goods they want to purchase based on their preferences and available resources, while producers respond to consumer demand by producing those goods and services that will generate profits. Therefore, the market forces of supply and demand guide the decisions about what and how much to produce in a market economy.

In a Market Economy, the Decisions About What to Produce