Massachusetts Tests for Educator Licensure (MTEL) Practice Test

In a capitalist economy, who typically owns property and resources?

1. The government

2. Communities

3. Individuals or private entities

4. Non-profit organizations

The correct answer is: Individuals or private entities

In a capitalist economy, property and resources are typically owned by individuals or private entities. This system is characterized by the means of production being held in private hands, allowing for personal profit and economic freedom. Individuals have the right to own property, start businesses, and engage in transactions, which drives competition and innovation. The idea of private ownership fosters an environment where people can freely trade goods and services, allocate resources based on supply and demand, and make decisions that they see fit for their individual interests. In contrast, other options like the government owning property represents a more socialist or command economy, where resources are controlled by the state, limiting individual ownership rights. Communities and non-profit organizations may have some control or ownership of resources, but this model does not align with the core principles of capitalism where individual profit and private ownership are paramount.