Question

The government does not interfere in the process of decision-making under _________________.

• A. market economy
• B. centrally planned economy
• C. mixed economy
• D. all of the above

Answer 1

Answer: (A)

market economy

In a free market economy, prices of commodities are affected by the market forces of demand and supply which leads to open competition in the economy. This leads to most efficient utilization of resources and capital, without the intervention of the government, for maximisation of profits.