Title: Identify characteristics of free enterprise.
Course: Principles of Business and Marketing (12051-36) > Section: Understanding the Role of Economics in a Global Economy

Identification should include the following concepts:

- Capitalism—an important element of capitalism is the private ownership of economic resources.
- Private enterprise—individuals invest their money and time to satisfy consumers’ needs and wants.

Individuals make decisions about products and distribution based on the elements of the free enterprise system:

- Freedom to own property
- Freedom to take risks
- Freedom to make a profit—achievement of monetary gain motivates individuals to engage in business ventures.
- Freedom to compete—rivalry exists among businesses to sell their goods and services.

Process/Skill Questions:

- What is a monopoly? What are some examples of monopolies?
- Why are monopolies permitted in a free enterprise system?
- What is an oligopoly? What are some examples of oligopolies?
- What effect does competition have on business and consumers?
- How does competition benefit the consumer?
- How do businesses compete for customers?
- How does competition make businesses more efficient?
- What happens when a business has no competition?
- Why is it important for a business to analyze its competition?
- What is profit? How is it important in a free enterprise system?
- Why do people put time, money, and effort into starting and running a business?
- What rights does free enterprise ensure?
- What other terms are used synonymously with free enterprise? Are they synonymous? Explain.
- What is considered private property? What rights does private property ensure?
- What are the two main types of competition?