HISET Social Studies Practice 2025 - Free HISET Social Studies Practice Questions and Study Guide

Free enterprise and market competition are fundamental characteristics of capitalism. In a capitalist system, individuals and businesses have the freedom to operate independently, make their own choices regarding production and investment, and engage in competition with one another. This competition is essential as it drives innovation, improves efficiency, and offers consumers a variety of choices.

The other options reflect different economic systems. Government ownership of all businesses is characteristic of socialism or communism rather than capitalism. Similarly, the distribution of resources by the government aligns with planned economies, which is not a trait of capitalism. Finally, equal sharing of wealth among citizens is typically associated with socialist ideologies, which seek to reduce class differences and promote equity. In contrast, capitalism often results in varied wealth distribution based on individual or business success.