Unit 2 Economics Review

Free Enterprise

economy characterized by private ownership of business with little government intervention

Profit Motive

the reason why people choose to improve their material well-being

Ex: buisness operating to max profits

Private Enterprise

the idea that everyone has the opportunity to open a business and decide what goods and services to provide

Private Property

you have the right to buy and sell property and is guaranteed by law

competition

if business is profitable then others will start their own to compete with profits and customers

consumer power

customers choose whether to purchase the goods and services

What two things does competition lead to in the marketplace?

better quality and lower prices

What is the private sector?

The part of the economy that is run by private individuals and companies that seek profit.

What is the public sector?

The part of the economy that is primarily controlled by the government. 

If private businesses provided public goods, what would they require of someone to consume it?

These private businesses may require some form of payment from the people to make a profit. 

What is the safety net?

 government aid given to the poor

Why does the government provide a safety net for some Americans?

decrease poverty and provide them opportunities to make a living.