Which of the Following Statements Most Accurately Identifies a Limitation

question 266

Multiple Choice

Which of the following statements most accurately identifies a limitation of the free-market economic system?

• A) Free-market economies offer little opportunity for the poor to work their way out of poverty.
• B) Free-market economies have been unable to create wealth as rapidly as other types of economic systems.
• C) Free-market economies are generally plagued by shortages of needed consumer goods.
• D) Free-market economies tend to result in unequal distribution of wealth.

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Definitions:

Investment

The allocation of resources, usually financial, to generate income or profit over time.

Physical Capital

Tangible assets used in the production of goods and services, such as machinery, buildings, and equipment.

Future Goods

Products or services that are not yet manufactured or provided but are planned for future sale.

Inputs

Resources such as labor, materials, and capital that are used in the production process to create goods or services.