In a market economy, the incomes of consumers depend primarily upon:
A) Government policies in setting wages and interest rates
B) The quantity and prices of resources that they possess
C) The amount of savings that they have accumulated
D) How closely connected they are to government and business leaders

Question

Quizplus · Accepted Answer

In a market economy, the incomes of consumers are primarily determined by the quantity and prices of resources that they possess. This includes their skills, education, and experience which determine the wages they can earn in the labor market, and their financial assets which generate income through interest and investment returns. The government may influence incomes through policies such as minimum wage laws, but ultimately it is the market forces of supply and demand that determine wages and prices. Savings may contribute to a person's income, but it is not the primary factor determining it. Connection to government and business leaders may provide opportunities for higher incomes in some cases but is not a general rule for all consumers.

In a Market Economy, the Incomes of Consumers Depend Primarily