A pure market economy, in which all resources are privately owned and economic decisions are guided mainly by prices, is sometimes called pure what?

Introduction / Context:
Economic systems can be classified according to who owns the resources and how decisions are made. In a pure market economy, resources are privately owned and prices determined by demand and supply guide production and consumption decisions. This type of system is often associated with the term capitalism. The question asks what a pure market economy is sometimes called.

Given Data / Assumptions:

• In a pure market economy, there is private ownership of land, labour, and capital.
• Firms and households act in their own self interest, responding to price signals.
• The government role is minimal or limited mainly to protecting property rights and enforcing contracts.
• Socialism typically involves significant state ownership and planning.
• We are focusing on ideal types described in basic economic theory, not on actual mixed economies.

Concept / Approach:
Capitalism is a term used to describe an economic system where capital and other resources are predominantly owned by private individuals and firms. Production and distribution decisions are largely determined by market forces and competition. When economists speak of a pure market economy, they mean a theoretical situation in which these features are fully realised and the state plays a very limited role. Therefore, a pure market economy is often referred to as pure capitalism in textbooks and exam materials.

Step-by-Step Solution:
Step 1: Recall that in a pure market economy, the key characteristics are private ownership, profit motive, and price guided decisions.Step 2: Recognise that capitalism is defined by these same features: private ownership of the means of production and reliance on markets.Step 3: Understand that in contrast, socialism involves state ownership and central planning for resource allocation.Step 4: Review the options and identify which one describes the name given to such a system.Step 5: Option a names capitalism and explains that capital and resources are privately owned, matching the description of a pure market economy.Step 6: Conclude that the correct term is pure capitalism.

Verification / Alternative check:
Introductory economics and political science texts frequently use the phrase capitalist market economy to refer to systems like those in some advanced industrial countries. They contrast this with socialist planned economies and mixed economies. When they describe theoretical extremes, they refer to a pure capitalist market economy, where all decisions are left to markets, and a pure command socialist economy, where central planning dominates. This confirms that pure market economy is associated with pure capitalism.

Why Other Options Are Wrong:
Stocking, in option b, is not a recognised name for any economic system and simply refers to the act of holding inventory. Sharing, in option c, might suggest communal distribution, which is closer to some interpretations of socialism, not to a market system based on private profit. Socialism, in option d, is a different system where the state plays a major role in ownership and planning, so it is not a pure market economy. Mercantilism, in option e, refers to a historical system of trade policy focused on accumulation of bullion and trade surpluses, not to the modern concept of a pure market economy.

Common Pitfalls:
Students sometimes mix up descriptive labels and may think that any modern economy that has markets is pure capitalism, even though most are mixed economies with significant government involvement. Others may confuse historical terms like mercantilism with contemporary systems. To answer correctly, it helps to focus on the key features of private ownership and market determination of prices and to recall that this combination is labelled capitalism in economic theory.

Final Answer:
A pure market economy is sometimes called pure capitalism, because capital and other resources are privately owned and decisions are guided mainly by market prices.