Free Enterprise

Notes by Ale

Free enterprise: capitalistic economy in which competition is allowed to flourish with a minimum of government interference. In other words is the unhindered use of privately owned resources to earn profits, this is different than capitalism because capitalism stands for the private ownership of resources. It is less regulated.

Characteristics:
· Private property rights: people may control their possessions as they wish. Gives people the incentive to work, save, and invest. They can keep any rewards they earn. Ex: copyrights, trademarks, etc.
· Profit motive: people and organizations may improve their material well-being by making money. It is the responsible characteristics that make a free enterprise system grow. If they do well they can earn a lot. If it goes wrong they can loose part of their investment.