Question

In a market economy, decisions about which goods are produced are based

on:
A. what health care organizations suggest will be best for citizens.
B. what businesses believe will generate the most profits.
C. what the government decides is important for society.
D. what the local community has made for generations.

Answer 1

B. what businesses believe will generate the most profits.

Step-by-step explanation:

A market economy is one where the factors of production are owned by the private sector. Production and distribution of products and services are in the hands of private individuals and firms. The government's role is mostly regulation and the provision of public goods.

In the market economy, the private sector engages in business to make profits. They risk their resources in producing goods and services that can increase their wealth. Only the products that are likely to generate profits are produced.