Which of the following is true in a market economy?
A) Central planners determine answers to the basic economic questions.
B) Resources are used efficiently.
C) The distribution of wealth is equal.
D) Information for production and distribution decisions pass directly to buyers from the government.

Question

Quizplus · Accepted Answer

In a market economy, resources are allocated based on supply and demand in the market. This results in resources being used efficiently as individuals and firms strive to maximize their own profits. Central planning is not a feature of a market economy, and thus option A is incorrect. The distribution of wealth is not necessarily equal in a market economy, which contradicts option C. The government typically does not directly pass information for production and distribution decisions to buyers in a market economy, making option D incorrect.

Which of the Following Is True in a Market Economy