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The economic system in which business units or factors of production are privately owned and governed is called as______.
  • a)
    capitalism
  • b)
    socialism
  • c)
    democratic
  • d)
    republic
Correct answer is option 'A'. Can you explain this answer?
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Most Upvoted Answer
The economic system in which business units or factors of production a...
Capitalism

Capitalism is an economic system in which private individuals or businesses own and control the factors of production, such as land, labor, and capital. This system is based on the principles of free markets, competition, and profit maximization.

Private Ownership

In capitalism, private individuals or businesses own and control the means of production. This means that they have the right to use and dispose of their property as they see fit. They can decide what to produce, how much to produce, and at what price to sell their products or services.

Free Markets

The free market is a central feature of capitalism. It is an economic system in which prices are determined by supply and demand. In a free market, individuals and businesses are free to buy and sell goods and services without interference from the government or any other external force.

Competition

Competition is another important principle of capitalism. In a competitive market, businesses are motivated to produce better products or services at lower prices in order to attract customers. This encourages innovation and efficiency in the economy.

Profit Maximization

The ultimate goal of businesses in capitalism is to maximize profits. This means that they seek to earn as much money as possible while minimizing costs. In a capitalist system, profits are seen as a reward for successful entrepreneurship and innovation.

Conclusion

In conclusion, capitalism is an economic system in which private individuals or businesses own and control the factors of production. It is based on the principles of free markets, competition, and profit maximization. This system has been criticized for creating income inequality and social injustice, but it has also been credited with promoting innovation, efficiency, and economic growth.
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The economic system in which business units or factors of production a...
A is the correct answer
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The economic system in which business units or factors of production are privately owned and governed is called as______.a)capitalismb)socialismc)democraticd)republicCorrect answer is option 'A'. Can you explain this answer?
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