In Which of the Following Types of Economic Systems Do

question 26

Multiple Choice

In which of the following types of economic systems do entrepreneurs and investors have the most amount of freedom with regard to controlling business ownership,profits,and resource allocations?

• A)Socialism
• B)Capitalism
• C)Communism
• D)Mixed economy

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Definitions:

Tax Rate

The tax rate is the percentage at which an individual or corporation is taxed, which can vary depending on income level, type of income, or jurisdiction.

Present Value

The contemporary valuation of a future sum of money or sequence of cash inflows, considering a certain rate of return.

Cost of Capital

The required return necessary to make a capital budgeting project, such as building a new factory, worthwhile.

Net Investment

The total amount spent on purchasing new capital assets minus depreciation on existing assets, indicating the actual increase in a company's capital stock.