What are characteristics of a market economy? Choose two.

In a market economy, supply, demand, and pricing are not determined by the government but are instead driven by individual consumers and businesses. Government planning is more characteristic of a command economy, where central authorities dictate economic activity.

Both China and the former Soviet Union operated under command economies rather than market economies, where the government exerted significant control over resources and production. This contradicts the principles of a market economy, which emphasizes free market mechanisms.

In a market economy, the factors of production—land, labor, and capital—are primarily owned by private individuals or businesses. Government ownership of production factors is a hallmark of socialist or communist systems, not of market economies.

A defining feature of a market economy is limited government intervention, allowing individuals and businesses to operate freely. An authoritative governmental role is characteristic of command economies, which regulate economic activity significantly.