Which best describes what occurs in the product market?

Which best describes what occurs in the product market?

A) the exchange of labor for capital.

B) the exchange of goods and services for factors of production.

C) the exchange of goods and services for money.

D) the exchange of money for factors of production.

Answer. C) the exchange of goods and services for money.

The product market, which is sometimes referred to as the goods and services market, is the level of the market at which consumers and businesses demand and supply final products. People spend part of their earnings to buy things that they need, want, or feel like buying which may include food, clothing, or even electronic equipment while companies make themselves available to meet the demands of the consumers with the aim of getting returns or revenues. This monetary means of exchange is useful in barter because it helps to simplify the process of a transaction by making it easier to compare values or exchange fractions. Thus option A describes the factor market as a market where one gives money and receives factors of production (land, labour, capital) (A and D), while option B confuses both markets by combining their elements.