The allocation of resources in a market economy is described by which of the following statements?

1) Buyers and sellers decide which goods are offered for sale.
2) Buyers and sellers exchange goods and services on a voluntary basis.
3) Prices and costs help producers decide whether they are producing too little or too much of a good.

a. 1 only
b. 2 only
c. 1 and 3 only
d. 2 and 3 only