GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Under capitalist economies, the answer to the fundamental questions-what, how and for whom to produce are obtained by-
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Government regulation
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Cost benefit analysis
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Market forces of demand and supply
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All of the above.
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Explanation:
Detailed explanation-1: -In a capitalist economy, the first question is answered by consumers as they spend their money. The second question is answered by producers as they compete for sales and profits. The third question is answered by those who have the money to buy the product.
Detailed explanation-2: -Market Mechanism Following closely with competition between industry peers, capitalist economies rely on an open market to determine what goods are produced and what they should cost.
Detailed explanation-3: -Intensity of consumer demand guides a capitalist economy to decide what to produce. In capitalist economy the goods are produced as per the demand of the consumers. The free interaction of demand and supply is allowed.
There is 1 question to complete.