How Does Government's Power to Coerce Behavior Tend to Reduce

question 10

Multiple Choice

How does government's power to coerce behavior tend to reduce private-sector risk?

• A) by enforcing contracts and discouraging illegal behavior that threatens private property
• B) by guaranteeing that the government will financially cover any losses by private-sector firms
• C) by strictly regulating the allocation of most property resources in the economy
• D) The coercive power of government only increases private-sector risk.

---

Definitions:

Capitalist Economy

A capitalist economy is an economic system where private individuals and businesses own the production and distribution of goods and services, operating for profit in competitive markets.

Antagonism

Active opposition or hostility between individuals or groups, often manifesting in conflicts or competition.

Market Situation

The current state or condition of a market, characterized by factors such as supply and demand, competition, and pricing.

Stratification System

The structured ranking of entire groups of people that perpetuates unequal rewards and life chances in society.