What is the definition of a market economy?

Question

Responses

an economy in which the government makes most of the goods
an economy in which the government makes most of the goods

an economy in which people make most economic decisions
an economy in which people make most economic decisions

an economy in which government makes most economic decisions
an economy in which government makes most economic decisions

an economy in which people distribute public goods

Answer 1

The correct definition of a market economy is:

an economy in which people make most economic decisions.

In a market economy, individual consumers and producers make choices based on supply and demand, and these decisions ultimately determine the production and distribution of goods and services. The role of the government is typically limited compared to a command or planned economy.