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Explain Why Our Economy In The United States Is Called A Free Enterprise System

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Chapter 2 Outline
Building On What You Know
Our economy in the United States is called a free enterprise system
Free enterprise = the people in their economic roles are free to make choice
The Pillars of Free Enterprise
A free enterprise system functions best when it is supported by 6 social and legal pillars
Private Property
Specialization
Voluntary Exchange
The Price System
Market Competition
Entrepreneurship
Private Property
Private property is the resources and products owned by individuals or businesses.
Public property refers to the resources and products owned by government
The right to own property is protected by the United States Constitution, and the right to decide how private property is used has always been an important part of American economic system
In the …show more content…

It makes voluntary exchange efficient, and it reduces the potential for disagreement among buyers and sellers → without money, a free enterprise system could not work
Goals of the U.S Economic System Full employment . Most Americans agree that our country should strive for full employment. → Full employment = almost all people in the labor force are able to find work. Economic growth. Americans agree that economic growth is desirable. Economic growth means an increase in output of goods and services in the U.S economy during a year Price stability = pieces of goods, services, and resources do not fluctuate significantly either up or down, in short periods of time. Economic freedom. As American, we generally believe that people should have a high degree of freedom to choose how to earn a living and how to spend their income. Economic freedom = freedom of choice in employment, buying, selling, use of our time and other decisions related to our economy Economic security = the basic needs of every person should be met Economic equity means fairness and impartiality. The economic system should offer all citizens equal economic

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