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The allocation of resources
Member rating: No Rating | Words: | Submitted: Thu Jan 13 2005
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COMPETIION and THE ECONOMIC ENVIRONMENT Assignment: The allocation of resources STUDENT NAME: Shan Ji A free market economy is an idealized form of a market economy in which buyers and sellers are permitted to carry out transactions based on mutual agreement on price without government intervention in the form of taxes, subsidies, regulation, or government ownership of goods or services. A free market economy is an economy in which the allocation for resources is determined only by their supply and the demand for them. This is mainly a theoretical concept as every country, even capitalist ones, places some restrictions on the ownership and exchange of commodities. If a commodity is in short supply relative to the number of people who want to buy it, its price will rise, producers and sellers will make higher profits and production will tend to rise to meet the excess demand. If the available...
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