Question

Why are free market economies able to attain economic growth? firms offer more incentives to encourage households to purchase more goods. everyone is acting in their own self-interest, which motivates market growth. competition encourages innovation, which causes growth. consumers can purchase all the goods they need, which cause firms to produce more?

Answer 1

Market growth It is all about the circular flow diagram. Firms produce more because there are more people willing to buy goods and they are free to do so, not a government to stop them. In addition prices are stable because of competition and there is a lot of variety for the consumer.

Answer 2

Competition encourages innovation, which causes growth

Step-by-step explanation:

The free market is an economic system based on supply and demand with little or no government control. ... Free markets are characterized by a spontaneous and decentralized order of arrangements through which individuals make economic decisions. Being a market with little or no government control limiting them , people are able to think out of the box in order beat their competitors and remain relevant thereby introducing newer brands to the market which at the long run helps to attain economic growth