2025 civics test · Question 12 · Principles of American Government
What is the economic system of the United States?
Any one of these answers is accepted
- Capitalism
- Free market economy
What this means
The United States has a capitalist economy, also called a market economy or a free market economy.
In this system, businesses and property are mostly owned by private individuals and companies rather than by the government. Prices are set largely by supply and demand, by what people are willing to buy and sell things for.
In practice the U.S. system is a mixed economy: the government still regulates industries, collects taxes, and runs programs like Social Security. But for this question the officer is listening for one short phrase.
Answer with either “capitalism” or “market economy.” Two words is enough.
Why this is on the test
This question has two accepted wordings and applicants often overthink it. A short two-word answer is all the officer is listening for.
How this question is asked
On the 2025 civics test, the officer asks up to 20 of the 128 questions out loud and you pass by answering 12 correctly. You answer in your own words. There is no multiple choice and nothing to write down for the civics portion.
Related questions
More from Principles of American Government.
- 1 What is the form of government of the United States?
- 2 What is the supreme law of the land?
- 3 Name one thing the U.S. Constitution does.
- 4 The U.S. Constitution starts with the words "We the People." What does "We the People" mean?
- 5 How are changes made to the U.S. Constitution?
- 6 What does the Bill of Rights protect?