Free Enterprise and Democracy Quiz

What is free enterprise?

• A system where the government controls all businesses

• A system where people make their own economic choices with little government control

• A system where only large companies can sell products

• A system where prices are set by the government

Which example BEST shows free enterprise in action?

• The government sets the price of bread

• A mayor is elected by voters

• Two lemonade stands compete for customers

• A law is passed by Congress

In a free enterprise system, what mainly determines prices?

• Government officials

• Business owners only

• Supply and demand

• Voters

What is democracy?

• A system where one leader makes all decisions

• A system where businesses control the government

• A system where people choose leaders and make decisions by voting

• A system where only wealthy people can vote

Which example BEST represents democracy?

• A business lowers prices to attract customers

• Citizens vote for a new president

• A company creates a new product

• A store advertises a sale

What is a shared principle between free enterprise and democracy?

• Government control

• Choice

• Lack of competition

• No individual rights

How are voting in democracy and buying goods in free enterprise similar?

• Both are controlled by the government

• Both allow people to influence outcomes through choices

• Both eliminate competition

• Both require permission from leaders

What role does competition play in both systems?

• It limits freedom

• It strengthens choices and improves outcomes

• It increases government power

• It removes individual rights

Why are individual rights important in both systems?

• They allow the government to control people

• They reduce economic growth

• They protect people’s freedom to make decisions

• They eliminate competition

What does “consumers vote with their dollars” mean?

• People vote in elections using money

• People influence businesses by choosing what to buy

• Businesses control elections

• Only wealthy people can shop