Final answer:
Investments, pricing, and supply in an economy are determined by market forces within the scope of markets. Demand and supply serve as the main mechanisms to address what and how products are produced and for whom. Prices in these markets convey vital information about demand and supply to buyers and sellers.
Step-by-step explanation:
In a system like the one described, investments, distribution, income production, pricing, and the supply of goods, commodities, and services are determined by market forces, usually within the context of markets. This framework operates within the economy as a whole,
where demand and supply are the primary social mechanism for answering the basic questions about what is produced, how it is produced, and for whom it is produced. In a market economy, these decisions are typically made through the interactions of buyers and sellers within markets, without direct government intervention.
Prices serve a critical role in these markets not only for goods and services, but also for labor and financial capital. They act as a social mechanism to collect, combine, and transmit information about the market, specifically the relationship between demand and supply,
thereby informing and guiding the decision-making processes of consumers and profit-seeking producers.