ECONOMICS
MARKET FAILURES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Fields in which the community pays a tax for the service
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Fields in which a single business pays
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Fields in which a person goes to the store to make a purchase
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Fields in which a company buys a truck to haul things
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Detailed explanation-1: -The term “free market” is sometimes used as a synonym for laissez-faire capitalism.
Detailed explanation-2: -Answer and Explanation: The correct answer is d. Government policies are the primary forces that guide the decisions of firms and households. In a market economy there is no central planning.
Detailed explanation-3: -Answer and Explanation: Clearly, the statement that does not belong to a market economy is c) Prices act as a “visible hand” to direct economic activities in allocating scarce resources.
Detailed explanation-4: -A market economy is an economic system in which the production of goods and services is directed by the laws of supply and demand. Supply and demand is an economic principle that describes how the balance between supply and demand regulates the prices of those supplies.