Question

Capitalism — a social political-economic system characterized by individual or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market. Socialism — a political-economic system of social organization in which the means of producing and distributing goods is owned collectively by the community and is administered and distributed by a centralized government. Which statement differentiates capitalism from socialism?

A. In capitalism, the means of production are collectively owned, while in socialism, they are privately owned.

B. Capitalism emphasizes a centralized government, while socialism relies on private decision-making.

C. Socialism is characterized by competition in a free market, while capitalism has centralized planning.

D. In capitalism, individual or corporate ownership is a key feature, while socialism emphasizes community ownership.

Answer 1

The main difference between capitalism and socialism is that in capitalism, the means of production are privately owned with an emphasis on profit-making, while socialism features collective or community ownership with a focus on equitable distribution.

Step-by-step explanation:

The key distinction between capitalism and socialism lies in the ownership and control of the means of production. In capitalism, these means of production, such as factories and businesses, are privately owned by individuals or corporations. These owners invest capital to produce goods or services for a market with the goal of making a profit. The capitalist system features competition in a free market, where prices and the distribution of goods are influenced by supply and demand.

On the other hand, socialism advocates for the means of production to be owned collectively by society or the community at large, often managed by a centralized government. The goal of this system is to distribute goods and wealth in a way that benefits the entire community, seeking to minimize the inequalities found in capitalism. Key services, such as healthcare, education, and transportation, might be publicly provided to ensure equal access for all citizens.

Therefore, according to the definitions and characteristics given, the correct statement that differentiates capitalism from socialism is D: In capitalism, individual or corporate ownership is a key feature, while socialism emphasizes community ownership.