BUSINESS ADMINISTRATION
BUSINESS ENVIRONMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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command economy
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traditional economy
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market economy
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socialist economy
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Detailed explanation-1: -Market economy is one in which both private and public ownership of firms is common. Private property, freedom, self-interest, competition, minimum government intervention are the characteristics of a market economy. A market economy is governed by supply and demand.
Detailed explanation-2: -Profit motive is important because it allows you to understand the current economic structure. When someone experiences profit motive, they’re taking action to make money, and this can distribute wealth to others.
Detailed explanation-3: -The profit motive refers to an individual’s drive to undertake activities that will yield net economic gain. Because of the profit motive, people are induced to invent, innovate, and take risks that they may not otherwise pursue.
Detailed explanation-4: -Producers are motivated by the profits they expect to gain from the goods or services they offer. Their incentive to produce-the thing that motivates them-is the idea that consumers will want or need what they are offering.