A free-market economy is one that:

A) allows the government to determine allocations of raw materials.
B) disperses national resources equally among the citizens of a nation.
C) operates under capitalism and laws of supply and demand.
D) disperses national resources equitably among the corporations in the nation.
E) allows the government to make all the major decisions.

Free-Market Economy

An economic system where prices for goods and services are determined by the open market and consumers, with minimal government intervention.

Capitalism

An economic system characterized by private or corporate ownership of capital goods, investments determined by private decision, and prices, production, and the distribution of goods that are determined mainly by competition in a free market.

Laws of Supply

Economic principles stating that as the price of a good or service increases, the quantity supplied of that good or service rises, and vice versa.