Capitalism
U.S. Naturalization Test (2025 Standard) glossary · Civics
Definition
The economic system of private ownership and free markets.
Capitalism in plain English
Capitalism is the name for how the U.S. economy is set up: people and companies (not the government) own businesses, land, and goods, and they buy and sell freely in what's called a free market, where prices rise and fall based on what people want. The basic idea is that if you can start a business, set your own prices, and keep your profits, you'll work hard and compete to offer better or cheaper things. Imagine a big open marketplace where anyone can set up a stall and shoppers choose who to buy from; that competition is the engine. It contrasts with systems where the government owns the businesses and decides what gets made.
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