what is a market economy?

Answer 1

It's an economy wherein the consumers determine the value of things by how much or how little they purchase something. If an item doesn't sell much, the value of it's stock drops and production is reduced. If something is in high demand then the price of the item, along with the value of the stock in the producing firm rises. This allows the firm to build additional plants to make more of the high demand item until a point of 'equilibrium' is reached.

This is opposed to a 'command or centralized' economy, where the government sets the price of an item irregardless of how much in demand it is (ie. the price of a bottle of Vodka in USSR) and the producing firm is not allowed to raise the price even though they need to in order to raise funds to build additional production capability to meet the demand for their product.

Answer 2

A market economy is one where the market the buyers make decisions separately but the resource allocation is collective meaning resources are allocated to the most efficient. This is done through preserving competition. In Milton Friedmans words we call it 'liquidity preference'. That is anything we tend to do or market should find a steady market and should be liquid immediately. Companies and people trying to achieve this compete with each other in providing goods and services and the market affirms the most efficient eventhough geographically dislocated but with one voice that the most efficient one doing so gets the resources allocated. It is also called the Laizes fairez economy.

Answer 3

It's a market without much government interference. The U.S. is a market economy because we let the market determin the supply and demand of good; thus the market determines the price. More on investment matters, see http://ibooyah.com

Answer 4

Market - people decide on prices eg employers offer wages, shops offer bananas and televisions (if you are lucky you have a choice)
As opposed to :
State - the government sets work and wage eg conscript soldier's pay and offers passports at the price it sets (everyone is unlucky - there is no choice)
Mixed - both eg NHS nurses get paid the rate the government sets but this is influenced by what the market pays (and vice versa). A bit of both

Answer 5

Market is a place where purchasing and selling transactions are processed. Economy refers to the value of the stocks or goods.
Market economy refers to the place where purchasing and selling transactions are processed to the value of the stocks or goods.

Answer 6

The current state of supply and demand

Answer 7

the supply and demand or turnover of this particular market...