Respuesta :
Answer:
D. Government Policies are the primary forces that guide decisions of firms and households .
Explanation:
Market Economy has factors of production owned , controlled & opereated by private sector . There is entire private ownership , with profit maximisation goal . All production , consumption & distribution takes place on basis of pure market forces - (demand & supply) . It is also called Capitalist Economy .
As mentioned : a) Hiring , Production decisions taken by independent private firms b) The free market 'Invisible Hand' guides self & social welfare c) Households take labour supply & goods consumption decisions - All these decisions taken independently by private producers & personal consumers , unintervened by government
D) Government policies guiding firms & households decision is not applicable to Market Economy , since there is no government intervention in this type of economy .
The market economy is one that is an economic system where the decisions regarding investment, production, and consumption are guided by prices. They are affected by the forces of supply and demand.
- The main characters of the economy is regulated by the free market and the laisser-faire system. The market economies are termed planned economies.
- Household and firm decisions are primary policies that affect the govt.
Hence the D is correct.
Learn more about the statements do not apply to a market economy.
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