The market system is said to be characterized by "consumer sovereignty." This is because:
A) A sovereign government determines which consumer goods will be produced
B) The prices of consumer goods are regulated by a sovereign government
C) Firms must match their production decisions to the consumers' choices
D) Consumer goods are considered to be more important than capital goods

Question

Quizplus · Accepted Answer

Consumer sovereignty means that consumers have the power to determine what goods and services are produced through their choices in the market. Firms must respond to consumer preferences and adjust their production decisions accordingly. This concept is a key aspect of a market economy, where the demand for goods and services ultimately determines what is produced and at what price. A sovereign government does not necessarily play a role in determining which goods are produced or setting prices in a market system.

The Market System Is Said to Be Characterized by "Consumer