Free Enterprise System

What is the money left over after a business pays all its expenses called?

• spendings

• earnings

• cost

• profit

A free enterprise system means __________.

• The government DOES NOT tell the people what they can make or sell.

• The government DOES tell the people what they can make or sell.

What is the situation when the demand for something is higher than the supply?

• demand

• scarcity

• supply

What is the role of producers?

• make the product

• buy the product

• carry out government program

• increase the profit of other retail stores

Which is an example of competition changing the marketplace?

• a chain bookseller forcing many individual booksellers to go out of business

• a chain hot dog restaurant failing to make a large profit

• a chain coffee shop having no effect on individual coffee shops

• a chain restaurant expanding its menu to include desserts

Free contract means that people can chose

• for themselves what legal agreements to enter into

• for themselves what positive externalities to support

• to enter and compete in the marketplace

• to enter into open opportunities

The incentive to improve material well-being by seeking to gain from economic activities is called

• legal equality

• marginal benefit

• open opportunity

• profit motive

Open opportunity helps to ensure that everyone is free to

• be efficient

• invest in stocks

• start businesses

• maximize production

Consumers "vote" by choosing

• a product over competing products

• a resource over other resources

• to become entrepreneurs

• to keep away from fad products

Producers determine the allocation of scarce resources by seeking

• incentives and responding to consumer votes on a product

• incentives and responding to all open opportunities

• profits and responding to consumer votes on a product

• profits and responding to all open opportunities