In addition to D. allowing competition among companies, a market economy flourishes where market forces determine prices.
A market economy allows competition, private ownership, free enterprise, and self-interest to be at the driver's seat with the forces of demand and supply determining the prices of goods. The government does not play any significant roles except in regulation to ensure market efficiency.
Competition differentiates a market economy from all other economic systems, e.g. socialism and communism. In a market economy, monopolies are few. The government is not the producer of goods and services.
Thus, a characteristic of a market economy is competition.
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