Producers have an incentive to produce those goods most desired by consumers at the lowest price in

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In a market economy, producers have the incentive to produce goods that are most desired by consumers because they compete with other producers for sales. The producers who can offer the lowest price for the desired goods will attract the most customers and therefore make the most profit. Centrally planned and communist economies do not operate on the basis of consumer demand and price competition, so producers do not have the same incentive to produce goods that are most desired at the lowest price.

Producers Have an Incentive to Produce Those Goods Most Desired