Which one of the following statements is true?

Question

Quizplus · Accepted Answer

In the factor markets, households supply labour to businesses in return for wages and salaries. This is the basis of the labor market, where businesses hire workers from households in exchange for payment. The other options are incorrect: A is wrong because the government does not typically set prices and quantities in individual markets in a market economy; B is incorrect because labour is not owned by businesses, it is a resource that businesses utilize, and it is supplied by households (who own the resource); C is wrong because businesses do not supply labour in the factor markets, they demand labor from households.

Which One of the Following Statements Is True