Firms owned by shareholders and individuals belong to which sector?

• A. Private sector
• B. Public sector
• C. Government
• D. Market

Answer: (A)

Ownership determines the sector. Firms owned by shareholders and individuals are not run by the government, so they belong to the private sector. The private sector consists of businesses owned by private individuals or private groups, driven by profit and decision-making by private owners. The public sector, in contrast, is made up of government-owned organizations and services. The market is the system where buyers and sellers interact; it isn’t a sector itself. So, a firm owned by private investors fits the private sector.