Market system is a profit-and-loss economy

Question

Evaluate and explain the statements: “The market system is a profit-and-loss economy”

Answer 1

The quotation is accurate. To produce income in a market system are motivated by attempt producer decisions. Those products that enable a firm to earn at least a normal profit will be produced.  If the manufactured goods is not be formed for a profit, in other words we can say, if losses are concerned in manufacture, capitalist firm will respond by seeking lower cost production methods and may stop the making of goods completely.