Summarize characteristics of a free enterprise system
Free enterprise is… Private enterprise Supply and Demand Entrepreneurs
The principles of a free enterprise system are…(con’t) Freedom of ownership Competition 1.Direct competition For example: McDonald’s vs. Burger King
The principles of a free enterprise system are…(con’t) 2. Indirect competition For example: McDonald’s vs. Applebee’s 3. Price competition For example: Wal-Mart 4. Non-price competition For example: Nordstorm
The principles of a free enterprise system are …(con’t) 5. Monopolies – sole control over a product and the means of producing it. Risk – potential for loss or failure Profit – All money left over from sales after expenses have been paid & the incentive for entrepreneurship
How does competition affect buyers & sellers? BuyersSellers