________ Is the Name of a Free-Market Economic System in Which

question 130

Multiple Choice

________ is the name of a free-market economic system in which most of the factors of production and distribution -- such as land, factories, railroads, and stores -- are owned by individuals.

• A) Socialism
• B) Capitalism
• C) Communism
• D) Marginalism

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Definitions:

Marginal Cost

The investment needed to manufacture an extra unit of a product or service.

Marginal Revenue

Enhanced revenue from the sale of an incremental unit of a product or service.

Variable Costs

Expenses that change in proportion to the activity of a business, such as costs for raw materials or production.

Profit-maximizing Output

This is the level of production at which a firm achieves the highest possible profit, determined by the point where marginal cost equals marginal revenue.