51 Free Enterprise

51 Free Enterprise

Guiding Question: How does the free enterprise system differ from mercantilism?

It Matters Because The British economic system of mercantilism limited the colonist’s freedom to freely trade with other countries. The free enterprise system encouraged free trade with limited government interference. 

• Content Objective: Today we will explain why a free enterprise system of economics developed in the new nation and describe its characteristics and benefits using a reading selection.

• Language Objective: Today we will use content area vocabulary in a written response to explain the U.S. free enterprise system.

Multiple Select

DO NOW: Check off THREE characteristics of free enterprise.

• Government doesn't not control but regulates to make it fair

• America was discouraged from producing manufactured goods

• Free to produce whatever goods wanted

• Free Trade: The U.S. can trade with any country it wants to

Vocabulary Words

• Free enterprise: an economic system in which private business operates in competition and largely free of state control.

• Revenue:  income generated from a business

• Market a place where two parties can gather to facilitate the exchange of goods and services. The parties involved are usually buyers and sellers.

• Enterprise: a business or company

Multiple Choice

A person who chooses to, and is free to, open a grocery store is participating in a

• command economy

• traditional economy

• free enterprise economy

Multiple Choice

To buy a product, customers in a market must first

• be willing to buy the product

• make sure the product is on sale

• learn the product's features

Multiple Choice

Which of the following is the best definition of REVENUE?

• The total amount of income a business makes from selling products or services

• The amount of money a business has LEFT over after paying for their costs.

Free Enterprise

The capitalist economic system of the United States helped spur industrial growth. In capitalism, individuals and businesses own property and decide how to use it. The people—not the government— control capital, which includes the buildings, land, machines, money, and other items used to create wealth.

Multiple Choice

In a free enterprise system __________________.

• individuals must have government approval to start businesses

• businesses are heavily regulated by the government

• individuals and groups can start their own businesses

Multiple Choice

Another word used to describe the free enterprise system is

• communism

• capitalism

• nationalism

• none of the above

Free Enterprise

We also use the term free enterprise to describe the American economic system. People are free to work wherever they wish and to buy, sell, and produce whatever they want. The main elements of free enterprise are economic freedom, relatively low taxes, profit, private property, and competition. Business owners produce the products they think will sell the best and make the most profit. Businesses compete for customers with low prices and high quality. This competition helps push businesses to improve.

Multiple Choice

Under a free enterprise system, businesses in the US are allowed to do all of the following EXCEPT

• decide what products to sell

• decide how to operate their business

• price their products

• they're allowed to do all of the above

Multiple Choice

The rivalry between sellers to get more customers by lowering costs & better goods/services

• voluntary exchange

• competition

• incentives

• legal equality

Open Ended

CLOSURE: How did opposition to mercantilism lead to the development of free enterprise?