How it fits together
In a capitalist economy, individuals and businesses own much of the property used to produce goods and services. Buyers and sellers make many economic decisions through markets. That is why “capitalism” and “free market economy” are both accepted answers to this question.
A closer look
A market economy still has laws, taxes, public services, and regulation. Calling the United States capitalist does not mean the government has no economic role. Keep the economic system separate from the political system: “republic” describes government, while “capitalism” describes the economy.