market economy

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Free market system in which decisions regarding resource allocation, production, and consumption, and price levels and competition, are made by the collective actions of individuals or organizations seeking their own advantage. In all market economies, however, freedom of the markets is limited and governments intervene occasionally to encourage or dampen demand or to promote competition to thwart the emergence of monopolies. Also called free economy, free market, or free market economy. See also open economy.

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Competition by companies to obtain your business helps to create products that consumers want to buy and this is one of the fundamentals of a market economy.
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Some philosophers have advocated for a laissez-faire system of economy where the government retains a hands off approach to regulating the economy, however realistically, in a system using the market economy, the government does play some role in regulation.
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A free market economy encourages individuals to start their own businesses by providing government subsidized low-interest small business loans to assist with startup costs.
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