Before we look at how the three questions are answered, we must quickly look at some of the characteristics of a free market economy.
CharacteristicsThey make the economic decisions.
C. They make the economic decisions
C. They make the economic decisions
C. They make the economic decisions
A circular flow model
They make the economic decisions.
C. They make the economic decisions
C. They make the economic decisions
C. They make the economic decisions
C. They make the economic decisions
C. They make the economic decisions
A circular flow model
C. They make the economic decisions
C. They make the economic decisions
In a free market system, customers and producers play complementary roles. Producers supply goods and services based on consumer demand, striving to meet preferences while maximizing profits. Customers, on the other hand, drive demand by making purchasing decisions that reflect their needs and desires. This interaction establishes prices and influences the allocation of resources, fostering competition and innovation within the market.
In a free market system, there are producers that make the product and consumers that purchase the product. The government just needs to make sure that the participants are following the laws and regulations and to provide proper infrastructure such as good roads and railways.
C. They make the economic decisions