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DaniilM [7]
3 years ago
13

What is one main feature of the free enterprise system?

Business
2 answers:
e-lub [12.9K]3 years ago
4 0

Answer:

Free enterprise, or the free market, refers to an economy where the market determines prices, products, and services rather than the government. Businesses and services are free of government control. Alternatively, free enterprise could refer to an ideological or legal system whereby commercial activities are primarily regulated through private measures. In principle and in practice, free markets are defined by private property rights, voluntary contracts, and competitive bidding for goods and services in the marketplace. This framework is in contrast to public ownership of property, coercive activity, and fixed or controlled distribution of goods and services.

In Western countries, free enterprise is associated with laissez-faire capitalism and philosophical libertarianism. However, free enterprise is distinct from capitalism. Capitalism refers to a method by which scarce resources are produced and distributed. Free enterprise refers to a set of legal rules regarding commercial interaction.

Another definition of free enterprise is in terms of economics and was offered by the Nobel-winning economist Friedrich Hayek. Hayek described such systems as "spontaneous order." Hayek's point was that free enterprise is not unplanned or unregulated; rather, planning and regulation arise from the coordination of decentralized knowledge among innumerable specialists, not bureaucrats.

KEY TAKEAWAYS

Free enterprise refers to business activities that are not regulated by the government but are defined by a set of legal rules such as property rights, contracts, and competitive bidding.

The argument for free enterprise is based on the belief that government interference in business and the economy hampers growth.

A free enterprise legal system tends to result in capitalism.

The Origins of Free Enterprise

The first written intellectual reference to free enterprise systems may have emerged in China in the fourth or fifth century B.C., when Laozi, or Lao-tzu, argued that governments hampered growth and happiness by interfering with individuals.

Legal codes resembling free enterprise systems were not common until much later. The original home of contemporary free markets was England between the 16th and 18th centuries. This growth coincided with, and probably contributed to the first industrial revolution and birth of modern capitalism. At one time, the English legal code was completely free of international trade barriers, tariffs, barriers to entry in most industries, and limitations on private business contracts.

The United States also used a largely free-market legal approach during the 18th and 19th centuries. In modern times, however, both the United States and the United Kingdom are better classified as mixed economies. Countries such as Singapore, Hong Kong, and Switzerland are more reflective of free enterprise.

Real-World Example

In the absence of central planning, a free enterprise legal system tends to produce capitalism although it is possible that voluntary socialism or even agrarianism could result. In capitalist economic systems, such as that of the United States, consumers and producers individually determine which goods and services to produce and which to purchase. Contracts are voluntarily entered into and may even be enforced privately; for example, by civil courts. Competitive bidding determines market prices.

The U.S. economic system of free enterprise has five main principles: the freedom for individuals to choose businesses, the right to private property, profits as an incentive, competition, and consumer sovereignty

SCORPION-xisa [38]3 years ago
3 0

Answer:

People often use the terms free enterprise, free market, or capitalism to describe the economic system of the United States. A free enterprise economy has five important characteristics. They are: economic freedom, voluntary (willing) exchange, private property rights, the profit motive, and competition

Explanation:

People often use the terms free enterprise, free market, or capitalism to describe the economic system of the United States. A free enterprise economy has five important characteristics. They are: economic freedom, voluntary (willing) exchange, private property rights, the profit motive, and competition

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At which stage of the new product development process is a physical product first​ developed?
cricket20 [7]

Answer:  Product development

Explanation:

Product development is referred to as or known as the creation of the products and commodity with the different or new characteristics which further offer the additional or new benefits to their consumers or customer.  The product development also tends to involve several modification of the existing commodity or product and also its presentation, or the formulation of the entirely newer product which thus satisfies the newly defined consumer or customer want.

7 0
3 years ago
Indicate whether each of the following cash activities would be reported on the statement of cash flows as (a) an operating acti
Tasya [4]

Answer:

Given list of cash activities is divided among operating activities, financing activities and investing activities in the explanation section.

Explanation:

  1. Paid for Advertising                Operating Activity  
  2. Paid for Office Equipment         Investing Activity
  3. Issued Capital Stock                 Financing Activity
  4. Paid officers salaries                 Operating Activity
  5. Sold services                                 Operating Activity
  6. Paid rent :                                       Operating Activity
  7. Paid dividends:                       Financing Activity
  8. Issued a note payable:                 Financing Activity
  9. Paid rent:                                  Operating Activity
  10. Sold excess office equipment: Investing Activity

Operating Activities include cash generated from operations, Interest Paid and Tax Paid.

Investing Activities include payment to acquire or proceeds from sale of property, plant and equipment, proceeds from government grants, interest and dividend received.

Financing Activities include proceeds from issue of shares, proceeds from long term borrowings, dividends paid etc.

4 0
3 years ago
Aziz company sells two types of products, basic and deluxe. the company provides technical support for users of its products, at
Marta_Voda [28]

The company's cost per customer support call is <u>25 dollars.</u>

<u></u>

Simply divide total costs by total calls to find the cost per call.

$250,000/ 10,000 calls = $25/ call

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3 years ago
Why is it important that an employer ensures that employees set personal and career goals?
pishuonlain [190]

Explanation:

To motivate and set task engagements by doing this it set strong goals boost performance by motivating people to push harder.

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2 years ago
Petra, a plant manager, received an e-mail from the CEO stating that the company will now be focusing on customer service. The e
svp [43]

Answer:

Petra,a plant manager ,received an e-mail from the CEO stating that the company will now be focusing on customer service.The e-mail also stated that all plant managers need to implement this policy and coordinate the activities related to this strategy for their lowest level mangers.Petra is a <u>middle level manager.</u>

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