Final answer:
Capitalism is an economic system based on private ownership and the investment of resources for profit, characterized by economic freedom, competition, and limited government intervention.
Step-by-step explanation:
The student is asking about an economic system characterized by private ownership and investment aimed at generating profit. The correct answer is Capitalism, which is the economic paradigm where private individuals or businesses own capital goods, and production is based on supply and demand in a general market. Under capitalism, economic freedom allows for private property rights, competition, voluntary exchange, and limited government intervention. This system operates in contrast to socialism or communism, where the means of production are commonly owned and managed by the state. For instance, in a capitalist society, individuals like Sarah, Antonio, and Chris may invest in private companies, expecting a return on investment which they can further reinvest or use at their discretion. In essence, capitalism supports the idea that individuals motivated by their own interests contribute to economic activity, where competition and market forces shape production and pricing.