Consider the following economic agents:
A.the government
B.consumers
C.producers
Who, in a market economy, decides what goods and services will be produced with the scarce resources available in that economy?
A)the government
B)producers
C)consumers
D)consumers and producers
E)the government, consumers, and producers

Question

Quizplus · Accepted Answer

In a market economy, producers decide which goods and services to produce based on consumer demand. Consumers, through their purchasing decisions, signal to producers what goods and services they want, and producers respond by producing those goods and services. Therefore, both consumers and producers play a role in deciding what goods and services will be produced. The government may have some influence through regulations and policies, but ultimately it is the decisions of consumers and producers that shape the market.

Consider the Following Economic Agents