Which of the following drives the free market economy?
(1 point)
• the needs and wants of the people
• the supply of goods in the market
© the number of consumers in the market
© the gross domestic product
• the needs and wants of the people
The correct answer is "the needs and wants of the people." In a free market economy, the allocation of resources, production, and pricing are determined by the needs and wants of the consumers. This means that consumers' demand for goods and services drives the market, influencing what is produced, how it is produced, and at what price. The other options, such as the supply of goods in the market, the number of consumers, and the Gross Domestic Product (GDP), are all related factors but are ultimately influenced by the needs and wants of the people in the market.
The correct answer is: the needs and wants of the people.
Explanation:
In a free market economy, the driving force behind economic activity is the needs and wants of the people. This means that consumers play a crucial role in determining what goods and services are produced and how they are allocated. When consumers demand a particular product or service, it creates a market for it, which in turn encourages businesses to produce and supply those goods or services. The free market operates on the principle of supply and demand, where producers aim to meet the demands of consumers by supplying the goods and services they desire. Ultimately, the interaction between supply and demand determines the prices of goods and services, and the allocation of resources in the economy.