Question

The market economy functions on four assumptions .Study the list below and answer the question that follows :

a) The allocation of resources is affected by free markets

b) The state keeps its interference in the system to a minimum

c) Members of a community may possess assets and earn profits on these .

d) Employs private initiate , while growing state intervention in key industries .

e) Members of the community can freely choose between products , services , places of residence and careers .

f) Ownership of a country's factors of production in which the individual owns no property , except private domestic assets .

1 a,b,c,d

2 a,b,c, e

3 b,c,d,e

4 c,d,e,f

Answer 1

The market economy functions on four assumptions:

1. The allocation of resources is affected by free markets.
2. The state keeps its interference in the system to a minimum.
3. Members of a community may possess assets and earn profits on these.
4. Members of the community can freely choose between products, services, places of residence and careers.

So, the correct answer is 2 a, b, c, e.