1. Private Property. Most goods and services are privately-owned. The owners can make legally-binding contracts to buy, sell, or lease their property. In other words, their assets give them the right to profit from ownership. But U.S. law excludes some assets. Since 1865, you cannot buy and sell human beings. That includes you, your body, and your body parts.
(Source: "Market Economy," University of Auburn.)
2. Freedom of Choice. Owners are free to produce, sell and purchase goods and services in a competitive market. They only have two constraints. First, is the price at which they are willing to buy or sell. Second is the amount of capital they have.
3.
Motive of Self-Interest. Everyone sells their wares to the highest bidder while negotiating the lowest price for their purchases. Although the reason is selfish, it benefits the economy over the long run. That's because this auction system sets prices for goods and services that reflect their market value. It gives an accurate picture of supply and demand at any given moment.
