Political Economy Economic Systems Questions
Capitalism is an economic system characterized by private ownership of the means of production and the pursuit of profit. In a capitalist system, individuals and businesses have the freedom to own and control property, make economic decisions, and engage in voluntary exchanges in the marketplace. The market forces of supply and demand determine prices and allocate resources. Capitalism encourages competition, innovation, and entrepreneurship, as individuals and businesses strive to maximize their profits. It is based on the principles of individualism, free markets, and limited government intervention in the economy.