What is meant by the term "entrepreneurship"?

• A. The process of investing in public services
• B. The act of starting and managing new businesses
• C. The role of government in business operations
• D. The restriction of market activities

Answer: (B)

Entrepreneurship refers to the act of starting and managing new businesses, which encompasses not only the creation of a business entity but also the ongoing management and innovative efforts that contribute to its growth and success. Entrepreneurs identify market needs, develop new products or services, and take on financial risks in pursuit of profit. This concept is essential to the economy as it drives job creation, fosters competition, and encourages technological advancement.

Understanding entrepreneurship helps illustrate its vital role in the free enterprise system, where individuals have the freedom to innovate and develop their ideas into viable business ventures. This aspect is pivotal for an economy that thrives on competition and consumer choice, emphasizing the dynamic and responsive nature of entrepreneurship in a capitalist framework.