What was the role of consumers and producers in free market?

Answer 1

In a free market, consumers and producers interact to determine the prices and quantities of goods and services. Producers supply goods and services based on consumer demand, aiming to maximize profits, while consumers exert influence through their purchasing choices, driving demand for certain products. This interplay helps allocate resources efficiently, as prices fluctuate based on supply and demand dynamics. Ultimately, the market operates on the principles of voluntary exchange and competition, fostering innovation and variety.