An effective market economy requires government rules for the enforcement of contracts.

Question

Quizplus · Accepted Answer

Contracts are fundamental to economic activity, and enforcing them is crucial for a market economy to function effectively. This is because contracts provide certainty and predictability for individuals and businesses, allowing them to plan their activities and investments with confidence. However, enforcing contracts requires a legal system and a government that can ensure compliance with the terms of agreements. Therefore, government rules that provide for contract enforcement are necessary for a well-functioning market economy.

An Effective Market Economy Requires Government Rules for the Enforcement