How does a pure market economy answer the basic question of which goods and services should be produced?(1 point)

Question

Responses

Consumers decide what should be produced.
Consumers decide what should be produced.

Producers decide what should be produced.
Producers decide what should be produced.

The government decides what should be produced.
The government decides what should be produced.

The law of supply and demand drives this choice.

Answer 1

The correct response is: The law of supply and demand drives this choice.

In a pure market economy, the decisions about which goods and services should be produced are determined by the interactions between consumers and producers through the mechanisms of supply and demand.