Question

Which statement best describes a mixed market economy?

a. In a competitive market, a furniture company decides to use cheaper materials to decrease production costs and pass on the savings. This is an example of a mixed economy.
b. A mixed market economy relies solely on government intervention to regulate prices and production.
c. In a traditional economy, businesses are motivated by profit and competition.
d. A command economy allows consumers to determine the prices of goods and services.

Answer 1

A mixed market economy involves a combination of private and public ownership, with economic decisions made by both individuals and government officials. Option a is the best description of a mixed market economy, as it illustrates a company using cheaper materials in a competitive market while government may intervene to regulate.

Step-by-step explanation:

A mixed market economy is characterized by a combination of private and public ownership of resources and businesses. In this type of economy, economic decisions are made both by individuals and private firms as well as by government officials. It allows for competition and profit motivation, but also involves government intervention to regulate certain aspects of the economy.

Option a is the best description of a mixed market economy. In this example, a furniture company decides to use cheaper materials to reduce production costs and pass on the savings to consumers. The decision to use cheaper materials is made by the company in a competitive market, while the government may intervene to regulate the quality of the materials or ensure consumer protection.