What is the economic system in the United States?

• A. Market economy
• B. Capitalist economy
• C. Socialist economy
• D. Command economy

Answer: (B)

The United States operates a capitalist economy where private individuals and businesses own the means of production and make most investment and production decisions. Prices and production are driven by market forces—supply and demand—through voluntary exchanges, with the profit motive guiding many decisions. A market economy describes how exchanges occur in markets, but calling the system capitalist emphasizes private property, capital investment, and market-based decision-making as defining features. Socialist or command economies involve government ownership and centralized planning of resources and production, which is not how the U.S. operates. So, capitalist economy is the best way to describe the overall system.