Advantages Of The Free Enterprise System
Profit Motive
Economic incentive of wealth accumulation
Public Good
Goods and services offered to the public via the government.
Public Transfer Payment
A payment in which the government transfers income from taxpayers to recipients who do not provide anything in return.
Free Rider
A person who chooses not to pay for a good or service but who benefits from it when provided.
Externality
A side effect of a transaction that effects someone other than the producer and the buyer.
Legal Equality
A situation in which everyone has the same economic rights under the law.
Free Enterprise System
An economic system in which anyone is free to start a business or enterprise.
Modified Free Enterprise Economy
An economic system in which includes some government protections, provisions, and regulations.
Negative Externality
An externality that has a negative impact effect, or cost, for people who were no involved in the original economic activity.
Positive Externality
An externality that has a positive impact or benefit to people who weren't involved in the market exchange.
Profit
The amount of money left over once the cost of production has been subtracted from the revenue.
Free Contract
The choice in what legal agreements you enter into.
Transfer Payment
Transfers of income from one person or group to another even thought he recipients does not provide goods and services back.
Market Failure
When people who are not part of a marketplace interaction benefit from or pay parts of the cost.
Infrastructure
the goods and services that are necessary to the smooth functioning of society.
