Final answer:
A market economy is where the economic questions of what to produce, how to produce, and for whom to produce are determined by customer demand, market forces, and purchasing power.
Step-by-step explanation:
A market economy is an economic system in which the basic questions of what, how, and for whom to produce are resolved primarily by the customers of the society. In essence, the economy as a whole relies on the mechanisms of markets, where the forces of demand and supply are the primary social mechanism for answering these fundamental economic questions.
Every economy must determine what should be produced based on the society's resources, how it should be produced considering factors like technology and labor, and for whom it should be produced which often depends on individuals' buying power within the society.
In a market economy, these decisions are made by private individuals and businesses, with minimal government intervention. Consumers influence what is produced by their purchasing choices; production methods are determined by businesses seeking efficiency and profit; and the distribution of goods and services is determined by purchasing power and market demand.