1 Essential Questions: Describe each of the 5 key features of the U.S. Free Enterprise Economy, and evaluate which feature is most important (and why?), explain the two markets that make up the circular flow model (who is involved and what do they exchange) Features of the U.S. Economy SECTION 2

2 Free Enterprise: The U.S. economic system is a version of capitalism called Free Enterprise Free Enterprise has 5 main features or characteristics. Each feature enables U.S. citizens to have freedom to act in certain ways or to receive certain benefits that promote a healthy economy. SECTION 2 Features of the U.S. Economy

3 Group work (Do Not Copy) Each group will focus on a different feature of Free Enterprise The group will be given a blank copy of the slide. As a group: Define the feature, Explain why it is signficant/important, and give an example of how we see it in our lives. SECTION 2 Features of the U.S. Economy

4 Freedom to own private property: Individuals have the right to own private property that cannot be taken by the government or others. Individuals may enter into agreements known as contracts to sell, trade, or give away this p.p. Individuals may also destroy their private property. SECTION 2 Features of the U.S. Economy

5 Freedom to make choices: Individuals have the right to choose how they will satisfy their wants and needs and answer other economic questions. SECTION 2 Features of the U.S. Economy

6 Freedom to act in Self-Interest: Individuals are allowed to put their own needs and wants ahead of others or society as a whole. This often leads to problems as individuals over-consume scarce resources. SECTION 2 Features of the U.S. Economy

7 Freedom to act in Self-Interest: Individuals are allowed to put their own needs and wants ahead of others or society as a whole. This often leads to problems as Individuals over-consume scarce resources. SECTION 2 Features of the U.S. Economy

8 Freedom to engage in competition: Individuals and businesses have the right to ethically compete with each other over consumers. Consumers are free to choose which producer they will consume from. SECTION 2 Features of the U.S. Economy

9 Limited Government Involvement : Individuals and businesses have the right to make their choices with as little government involvement as possible. The govt. only interferes when public safety is at risk OR when Public Good demands that the govt. shifts focus to a different element of F.E. SECTION 2 Features of the U.S. Economy

10 Two markets of the circular-flow model: product market- on this market finished products and money payments are exchanged between individuals, businesses, and government. resource market- in this market resources are provided and consumed to make products in exchange for money payments between individuals, businesses, and government. SECTION 2 Features of the U.S. Economy