U.S. Free Enterprise

business ownership by ordinary people, not the government

• monopoly

• private enterprise

• federal reserve

basic principles of free enterprise system include freedom to own property and which of the following

• freedom to make a profit

• freedom of competition

• freedom to take risks

• all of the choices

What does this curve represent?

• demand

• supply

• equilibrium

• shortage

In a market economy, who decides on the prices of goods and services?

• government

• buyers and sellers

• firms

• local leaders

Typically, when households are shown on the right side of a circular flow model of a modified free enterprise system, businesses are located

• on the left

• in the center

• at the top

• at the bottom

A modified free enterprise system

• is dominated by elements of the command economic system

• is dominated by elements of the traditional economic system

• has no government involvement in the economy

• has some government involvement in the economy

Open opportunity helps to ensure that everyone is free to

• be efficient

• invest in stocks

• start businesses

• maximize production

What is the primary role of consumers in a free enterprise system?

• To regulate prices

• To purchase goods and services

• To control production

• To set government policies

Which of the following is a characteristic of a free enterprise system?

• Government ownership of resources

• Centralized economic planning

• Private property rights

• Fixed pricing by the state

In a free enterprise system, what motivates businesses to improve products and services?

• Government mandates

• Consumer demand

• Profit incentive

• Regulatory requirements