All Courses
Explore Courses UPSC Exam UPSC Test Series Free Notes EduRev Infinity Get the App Login Join for Free
Sign in Open App
CA CPT Exam  >  CA CPT Questions  >  Consumers and produces make their choices bas... Start Learning for Free
SaveJoin the Discussion on the App
Consumers and produces make their choices based on the market forces of demand and supply in—
  • a)
    Socialist (Command) Economy
  • b)
    Mixed Economy
  • c)
    Capitalist Economy
  • d)
    Closed Economy
Correct answer is option 'C'. Can you explain this answer?
FREE This question is part of
Download PDF Attempt Test
Download PDF Attempt this Test
Verified Answer
Consumers and produces make their choices based on the market forces o...
Consumers and producers make their choices based on the market forces of demand and supply in Capitalist economy. Capitalist economy is also called the market economy in which the prices are determined by the free interaction of the forces of demand and supply. It is an automatic self-regulating mechanism which runs with the motive of profit. 
View all questions of this test
Most Upvoted Answer
Consumers and produces make their choices based on the market forces o...
Order to maximize their utility or profits. Demand refers to the quantity of a good or service that consumers are willing and able to buy at a given price, while supply refers to the quantity of a good or service that producers are willing and able to sell at a given price.

Consumers make their choices based on the market forces of demand and supply by considering factors such as price, quality, and availability of the product or service. If the price of a good or service is too high, consumers may choose to buy less or look for alternative options. On the other hand, if the price is low, consumers may choose to buy more or even stock up on the product.

Producers, on the other hand, make their choices based on the market forces of demand and supply by considering factors such as production costs, profitability, and market demand. If the demand for a product or service is high, producers may choose to increase their production to meet the demand and maximize their profits. If the demand is low, producers may choose to reduce their production or even stop producing the product altogether.

In a competitive market, the interaction of demand and supply forces determines the equilibrium price and quantity of a good or service. The equilibrium price is the price at which the quantity demanded equals the quantity supplied. At this price, there is no shortage or surplus of the product, and both consumers and producers are satisfied.

Overall, consumers and producers rely on the market forces of demand and supply to guide their choices and actions in order to optimize their own utility or profits.
< Previous Question Next Question >
Explore Courses for CA CPT exam

Similar CA CPT Doubts

Features of a Mixed Economy:A mixed economy is an economic system that combines elements of both a market economy and a planned economy. It incorporates features of both private enterprise and government intervention. The correct answer is D, as all of the following features are characteristic of a mixed economy:1. Planned economy:A mixed economy includes elements of a planned economy, where the government plays a role in guiding and regulating economic activities. It formulates economic plans and policies to ensure the efficient allocation of resources and to promote economic stability.2. Dual system of pricing:In a mixed economy, there exists a dual system of pricing, which means that both market prices and government-set prices coexist. While market forces determine prices for most goods and services, the government may intervene to regulate prices in certain sectors to protect consumers or promote social welfare.3. Balanced regional development:Another characteristic of a mixed economy is the emphasis on balanced regional development. The government intervenes to ensure that economic growth and development are not concentrated in specific regions or industries but are spread across different regions and sectors. This helps to reduce regional disparities and promote overall economic stability and social welfare.Benefits of a Mixed Economy:A mixed economy offers several benefits due to its combination of market forces and government intervention. Some of these benefits include:1. Economic efficiency:By incorporating market mechanisms, a mixed economy allows for resource allocation based on supply and demand, which promotes economic efficiency. Market forces encourage competition, innovation, and productivity, leading to higher levels of economic growth.2. Social welfare:Government intervention in a mixed economy enables the provision of public goods and services that may not be adequately provided by the market alone. This includes areas such as healthcare, education, infrastructure, and social security, ensuring a certain level of social welfare and equity.3. Stability and regulation:The government's role in a mixed economy helps to maintain economic stability through macroeconomic policies such as fiscal and monetary measures. It also regulates certain sectors to prevent market failures, protect consumer rights, and ensure fair competition.Conclusion:A mixed economy combines the advantages of both market forces and government intervention. It allows for economic efficiency, social welfare, and stability. The features of a mixed economy include elements of a planned economy, a dual system of pricing, and balanced regional development. These features work together to create a system that promotes both economic growth and social welfare.

Top Courses for CA CPTView all

Top Courses for CA CPT

Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer?
Question Description
Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer? for CA CPT 2024 is part of CA CPT preparation. The Question and answers have been prepared according to the CA CPT exam syllabus. Information about Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA CPT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer?.
Solutions for Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA CPT. Download more important topics, notes, lectures and mock test series for CA CPT Exam by signing up for free.
Here you can find the meaning of Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer?, a detailed solution for Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer? has been provided alongside types of Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Consumers and produces make their choices based on the market forces of demand and supply in—a)Socialist (Command) Economyb)Mixed Economyc)Capitalist Economyd)Closed EconomyCorrect answer is option 'C'. Can you explain this answer? tests, examples and also practice CA CPT tests.
Explore Courses for CA CPT exam

Top Courses for CA CPT

Explore Courses

Suggested Free Tests

Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev
Get App
© EduRev
Education Revolution
Follow Us
Signup to see your scores go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup