The free market involves ?
Correct answer: C. Market forces of supply and demand
- A. The free provision of products
- B. The Subsidizing of products by the government
- C. Market forces of supply and demand
- D. All trade via barter
Explanation
A free market allocates resources mainly through the interaction of supply and demand, with prices coordinating buyers and sellers. It does not mean that products are free or that trade must use barter.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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