Which statement defines free enterprise?

• A. People make all the choices and own the means of production (capitalism)
• B. The government makes all economic decisions
• C. The economy is centrally planned
• D. Production is owned by the state

Answer: (A)

Free enterprise means individuals and private businesses have the right to own property and make most production decisions with limited government interference. The statement that describes people making all the choices and owning the means of production best captures this idea, since private ownership and decentralized decision-making are core features of free enterprise (often called capitalism). The other descriptions depict economies where the government plans or owns most or all production, which aligns with command or socialist systems rather than free enterprise.