The degree to which an economic system approaches a market economy depends on the degree to which
A)economic choices are made through the free interaction of buyers and sellers in the marketplace.
B)there are monopolies in the marketplace.
C)people have a high standard of living.
D)advanced technology is used.

Question

Quizplus · Accepted Answer

A market economy is characterized by the free interaction of buyers and sellers in the marketplace, with economic choices being made based on supply and demand. The more this interaction is allowed to occur without interference from government or other external forces, the more closely an economic system approaches a market economy. Monopolies (B) can limit competition and distort market forces, and while a high standard of living (C) may be a result of a market economy, it does not define or determine the degree to which an economy functions as a market economy. Similarly, advanced technology (D) may help facilitate market activity but is not a defining characteristic of a market economy.

The Degree to Which an Economic System Approaches a Market