Key Economic Principles of Free Enterprise Ms. Cichon

Free Enterprise System in which economic agents are free to own property and engage in commercial transaction

Effective Managers… They are able to identify the needs of consumers and adjust their agribusinesses to meet those needs quickly and efficiently

Economic Principle Basic premises that explain the free enterprise system

Diminishing Marginal Utility When a product or service is consumed, a time comes when the utility (or pleasure or benefit) of consuming that product or service declines.

Demand Relationship between price and quantity that illustrates how much consumers are willing and able to purchase at various prices.

Demand

Demand Shift

Supply Relationship between price and quantity that illustrates how much producers are willing to supply at various prices

Supply

Supply Shift

Equilibrium Price and Quantity Point at which the supply and demand schedules intersect and at which the quantity offered for sale matches exactly the quantity that consumers are willing to purchase.

Equilibrium Price and Quantity

Economic Opportunities Possible business prospects available in today’s global economy