In a market economy,which of the following determines the answer to the WHAT to produce question?
A)Direct negotiations between consumers and government.
B)Prices and profit.
C)Government directives.
D)A democratic vote by all consumers.

Question

Quizplus · Accepted Answer

In a market economy, prices and profit determine what to produce. Producers will tend to produce the goods and services that have the highest demand and offer the highest profit margins. Consumers determine demand through their purchasing decisions, which then affects prices and profit.

In a Market Economy,which of the Following Determines the Answer