Question

How do private property rights encourage individuals to work, save, and invest? A) Individuals can keep the gains they earn. B) Most investments are guaranteed by the government. C) Most earnings of individuals will go to the government. D) Any earnings or wealth cannot be passed on through inheritance.

Answer 1

A) Individuals can keep the gains they earn.

Step-by-step explanation:

Though the government does impose certain taxes, individuals can keep the gains they earn. An individual's private property, such as land or capital, can generally be used for any legal enterprise. The prospect of earning money for using that property is the incentive for individuals to work, save, and invest. This is known as "profit motive."

Answer 2

A. We keep the gains (privately) for ourselves more so than in economies where property is controlled by the government.