In Which Type of System Are Both Producers and Consumers

question 16

Multiple Choice

In which type of system are both producers and consumers free to make their own economic decisions on many basic issues?

• A) mercantilism
• B) capitalism
• C) socialism
• D) communism

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Definitions:

Operating Activities

Activities that are directly related to the day-to-day operations of a business, such as sales, purchase of inventory, and payment of expenses.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue; often referred to as the bottom line.

Transactions

Business activities or exchanges that affect the financial position of a company, involving the transfer of goods, services, money, or titles.

Investing Activities

Financial actions involving the purchase and sale of long-term assets and investments, part of a company's cash flow statement.