Final answer:
The U.S. operates under a free enterprise system, a form of capitalism marked by private ownership of land and capital, economic freedom, and government regulation to promote market equity and efficiency. This system allows for competition and voluntary exchange, key to innovation and growth.
Step-by-step explanation:
Understanding the Free Enterprise System
The United States operates under a free enterprise system, which is a type of capitalism. In a free enterprise system, private individuals and businesses own the factors of production, which include land and capital. These owners operate their businesses for profit while enjoying economic freedom. The system is characterized by competition and voluntary exchange, which drive innovation and economic growth.
Government interaction in the free enterprise system involves both regulation and promotion of economic stability and growth. Over time, the role of the government has evolved, balancing economic freedoms with the need for regulations to ensure equity, security, and efficiency within the marketplace.
Matched Items:
- Free Enterprise System - (A) Private ownership of capital
- Mixed Economy - (B) Private and state ownership of business
- The former Soviet Union - (C) Command economy
- Land and Capital - (D) Factors of production