Which statement best describes the economic system of the United States?

Study for the Praxis Social Studies: Content Knowledge (5081) Exam. Prepare with diverse question formats and detailed explanations. Ace your test with confidence!

The economic system of the United States is characterized primarily by a mixed economy, where market forces play a significant role, but the government also intervenes to regulate and modify these forces to achieve broader economic goals. This means that while supply and demand largely dictate prices and production, the government intervenes through regulations, taxes, and subsidies to address market failures, ensure fairness, and promote stability.

Option C accurately reflects this balance, emphasizing that decisions are predominantly driven by market forces but also acknowledges the government's role in modifying those forces when necessary. This duality allows for both the efficiency of capitalism and the safeguards that come from government oversight, which is essential for promoting social welfare and addressing inequalities that may arise in a pure market system.

The other options do not fully encapsulate the interplay between market forces and government intervention present in the U.S. economic system. While some may imply a greater degree of government control or oversight than exists, they miss the critical aspect of how much decision-making authority is retained within private markets. Thus, the chosen option best describes the nuanced reality of the American economic framework.

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