Free Enterprise System

Lesson Objective

Today you will learn about the characteristics and benefits of the U.S. free enterprise system.

You will know you have it when you can identify and describe the four characteristics of the free enterprise system.

Materials

Social Studies Notebook
Pencil
Computer

Multiple Choice

STAAR PREP.

Agriculture, manufactures, commerce, and navigation, the four pillars of our prosperity, are the most thriving when left most free to individual enterprise.

Which economic principle is President Jefferson showing support for in this excerpt?

• Minimal government regulation

• Protective tariffs

• Limited Competition

• Taxes to fund internal improvements

Multiple Choice

STAAR PREP: How did opposition to this system affect the economy of the early republic?

• The government prevented taxes on domestic goods

• Cottage workers needed government assistance

• Interstate trade taxes were forbidden

• A free enterprise system was adopted

Multiple Choice

STAAR PREP: Which person was most likely a supporter of free enterprise?

• 1

• 2

• 3

• 4

Multiple Choice

You live next to the Mississippi River in St. Louis, Missouri. The best place to cross the river at your property, so you decide to build a ferry to help people cross. Local officials will allow the ferry to be built only if they run it and charge the fees they want, giving you almost no profit or income.

Is this a Free Enterprise system? If yes, identify characteristics.

• Yes, this is a Free Enterprise system.
• No, this is not a Free Enterprise system. Personal property rights have been denied. Profit motive denied.

• Yes, this is a Free Enterprise system because you can set your own prices.
• No, this is a Free Enterprise system but with limited competition.

Multiple Choice

You are a settler living in Virginia. You have a number of milk cows and have extra milk you could sell or exchange. Several neighbors have expressed interest in exchanging some of their fruits and vegetables for your milk.

Is this a free enterprise system? If yes, identify the characteristics.

• Yes, but it requires government approval.
• No, because milk cannot be traded.
• No, this is a command economy.
• Yes, this is a free enterprise system. There is a voluntary exchange of goods. Profit motive in place.

Multiple Choice

You own a lumber mill near the Appalachian Mountains. Because many immigrants are moving into area and need lumber for housing. You have plenty of trees on your property that can be cut-down for lumber. However, the local government wants to set the price of lumber to prevent competition among other mills.

Is this a free enterprise system? If yes, identify characteristics.

• Yes, this is a free enterprise system.
• The government should control all prices.
• No, this is not a free enterprise system. Economic freedom, property and profit denied.

• Competition is encouraged in this scenario.

Multiple Choice

You are a carpenter by trade, and you have moved from town to town in the last few years. You want to settle down in Boston to start a carpentry business. The Boston council has ruled that only one carpenter can live in the town, and Boston already has one carpenter. You will have to move to a different town to earn a living.

Is this a free enterprise. If yes, identify characteristics.

• Yes, this is a free enterprise.
• Boston has multiple carpenters allowed.
• You can operate a carpentry business remotely.
• No, this is not a free enterprise. Economic freedom has been denied.

Multiple Choice

You own a farm in Georgia. You have been very successful and have a number of cows to sell. You decide to sell your stock at a cheaper price, taking out a special ad in the local newspaper. Is this a free enterprise. If yes, identify characteristics.

• No, it is not a free enterprise.
• Yes, it is a free enterprise. Economic Freedom, Voluntary Exchange, Profit motive.

• Yes, but it lacks competition.
• Yes, but it is government regulated.

Identify and explain 2 benefits of the free enterprise system.

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Exit Ticket!