In which type of economy, all activities are organised by market?

Correct option is C

Ans. (C) Market Economy

Sol.

In a Market Economy, all activities, such as production, distribution, and pricing, are determined by the market forces of supply and demand. The government has little to no intervention, and businesses operate based on consumer preferences and competition. This type of economy is driven by private enterprise where individuals and companies make decisions on what to produce, how to produce, and for whom to produce.

Information Booster:

• Market Economy – Also known as a free-market economy, where the prices of goods and services are determined by the competition and the demand and supply in the market.
• Characteristics:
  • Private ownership of resources and means of production.
  • Minimal government intervention.
  • The role of government is mainly limited to enforcing laws and protecting property rights.
• Examples: USA and Hong Kong have characteristics of market economies, though many countries are moving towards a more mixed economy model.