Which of the following best defines how a society's economic system is determined?

• A. By the level of technological advancement in the society
• B. By the number of people employed in the government sector
• C. By the total amount of money in circulation
• D. By the way resources are allocated and goods and services are distributed

Answer: (D)

Verified step by step guidance

1. Understand that an economic system is a framework that a society uses to decide how to allocate its scarce resources and distribute goods and services among its members.
2. Recognize that the level of technological advancement, the number of people employed in government, and the total money supply are factors that can influence an economy but do not define the economic system itself.
3. Focus on the concept of resource allocation, which involves decisions about what to produce, how to produce, and for whom to produce, as the core of any economic system.
4. Identify that the way resources are allocated and goods and services are distributed reflects the fundamental characteristics of an economic system, such as whether it is market-based, command-based, or mixed.
5. Conclude that the best definition of how a society's economic system is determined is by the method it uses to allocate resources and distribute goods and services.