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Which of the following is true of a pure market economy?

a.It has elements of both a market economy and a command
economy.
b.All factors of production are privately owned.
c.Its policies are based on religious decree.
d.All factors of production are owned by the government.

User DMEM
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1 Answer

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Final answer:

A pure market economy is characterized by the private ownership of all factors of production where individual consumers and firms make economic decisions in a decentralized manner through market forces, without government interference.

Step-by-step explanation:

The true characteristic of a pure market economy is that all factors of production are privately owned. This means that individual consumers and firms make decisions about what to produce, how to produce it, and for whom the production is intended, without governmental interference. Decisions are made in a decentralized manner and are coordinated through markets, exemplified by institutions like the New York Stock Exchange, which brings together buyers and sellers. In a command economy, the government owns resources and businesses, contrasting sharply with the market system where private enterprise prevails. In essence, market forces are responsible for economic decisions, not the government.

User Keramat
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