Supply and demand in a market economy are dictated by what is called ________.

Question

Quizplus · Accepted Answer

The price mechanism is a system where the forces of supply and demand interact to determine the prices of goods and services in a market economy. When demand is high and supply is low, the price of a product or service will increase until the market reaches equilibrium. Conversely, when supply is high and demand is low, the price will decrease until a balance is reached. This system operates without the need for government intervention or control.

Supply and Demand in a Market Economy Are Dictated by What