The main characteristics or features of market economy can be pointed out as follows:
1. Property Right
In market economy, economic factors and other factors of production are owned by the people or private organizations. All the resources (both natural and capital) are under private control.
2. No Government Intervention
Limited government role is another feature of free market economy. There will be no direct government intervention because demand and supply regulate the whole market.
3. Freedom Of Choice
Market economy promotes consumers' sovereignty. Producers are free to produce and sell their products and consumers are also free to choose the products according to their needs, wants and desire.
4. Competition
Free market economy promotes perfect competition. Competition between different producers about quality and price of similar products exists.
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5. Profit Motive
Profit motive is also the notable feature of market economy. All economics activities (production, distribution and exchange) are performed to earn profit.
6. Price Mechanism
In free market economy, price of products or services is determined by the demand and supply condition.
