American Free Enterprise

The “Land of Opportunity” In America today, there are 18 million small businesses… Most were started by a single entrepreneur. America has always been seen as a nation with special opportunities… Open land, natural resources, free immigration… But the key is the tradition of free enterprise— Social and political commitment to giving people the freedom to compete in the marketplace.

Constitutional Protections The US Constitution guarantees important rights that allow people to engage in business activities… The most important is the right to property— The Fifth Amendment states: “nor shall private property be taken for public use without just compensation”. Businesses are treated as “people” and get the same protections.

The Rights of Private Ownership Private ownership of property involves three things: The right to exclusive use… Legal protection against invasion—those who would use or abuse property without the owner’s permission… The right to transfer (sell) property to another. As you can see, without these protections, free enterprise CANNOT exist.

Economic Rights Legal Equality—everyone has the SAME rights. Other nations restrict the rights of women and minorities. The Right of Free Contract—allows people to decide what agreements to enter. Voluntary Exchange—allows people to decide what and when they want to buy and sell. Competition—the rivalry among businesses to attract customers.

The idea that people are allowed to decide what and when they want to buy and sell is known as... iRespond Question F Multiple Choice A.) Government Regulation B.) Voluntary Exchange C.) Voluntary Purchasing D.) Legal Equality E.)

Which of the following constitutional rights is the most important for those who engage in business activity? iRespond Question F Multiple Choice A.) Right to private property B.) Right to free speech C.) Right to be taxed D.) Right to free religous expression E.)

Mixed Economies A mixed economy is a market-based economic system with limited government involvement. The economy of the United States is VERY open and free….but is not the MOST FREE… The US government is involved in the economy in many ways (minimum wage, safety standards, etc.)… For this reason, we say that America has a MIXED free-market economy… A free-market economy with LIMITED government interference.

Mixed Economies Where Governments Dominate North Korea—the government owns all property and economic output… State-owned industries produce 95% of consumer goods… China—the government dominates 75% of all market enterprises. China, however, in in TRANSITION… Moving away from government control to private control.

North Korea—A command-economy Dictatorship. South Korea— A mixed-free market Democracy

Mixed Economies Where Free Enterprise Dominates Hong Kong—was once administered by Great Britain… And had nearly total economic freedom… It reverted back to Chinese control in 1999… Is now a special economic zone… And had been allowed to keep it’s free system.

Which of the following countries has an economic system in which the government owns the highest percentage of the productive resources? iRespond Question F Multiple Choice A.) China B.) Hong Kong C.) United States D.) North Korea E.)

A market-based economy with limited government involvement is known as a ____________________. iRespond Question F Multiple Choice A.) Command Economy B.) Free Economy C.) Mixed Economy D.) E.)