The document defines and explains key aspects of capitalism. It states that capitalism is an economic system based on private ownership and free markets where individuals can own and use resources to seek profit. It operates on principles like free enterprise, competition, economic freedom, private property rights, the profit motive, and voluntary exchange between buyers and sellers. The document argues that these features of capitalism have made it the most successful economic system in history.

1. CAPITALISM! “ No other economic system in the history of the world has been as successful” -Civics Textbook copyright 2008

2. What is Capitalism? An economic system in which private citizens own and use the factors of production in order to seek a profit. Based on free markets and private ownership

3. Not to be confused with “FREE ENTERPRISE” This is simply another adjective used to describe the American Economy. Competition is allowed to flourish with a MINIMUM OF GOVERNMENT INTERFERENCE

4. We operate under both headings; our economic system is known as: FREE MARKET CAPITALISM

5. What makes Capitalism Work? Markets Economic Freedom Private Property Rights Competition Profit Motive Voluntary Exchange

6. MARKETS Local, regional, national or global They connect different sectors of the economy Chart of 522 – the one from the essay…. The Business Sector and Consumer Sector are connected through Factor Markets and Product Markets… Consumer Sovereignty The consumers decide what the businesses are producing

7. Economic Freedom FACTOR MARKET - We get to choose what type of job to have…, and we can choose when and where we would like to work. PRODUCT MARKET - Consumers have the Right to choose the products we buy. Businesses have the right to produce whatever they want Comes with Consequences……

8. Private Property Rights FACT: We can keep whatever we earn FACT: We have the right to own our own property (“stuff”) FACT: People take care of things better when they OWN them… RESULT: People work hard so they can get more “stuff” to own.

9. Competition The struggle between buyers and sellers to get the best products at the lowest prices Competition btw sellers drives prices down Buyers compete to find the best “deals”

10. Competition Competition rewards the most efficient producers Competition punishes the least efficient producers The result of competition in Capitalism is: Efficient production, high quality products, more satisfied customers

11. Profit Motive People are free to risk their savings or any part of their wealth in a business venture Could go either way…. Profit Motive is the driving force that encourages individuals to improve their material well being… They are trying to “make a profit”

12. Voluntary Exchange The act of buyers and sellers freely and willingly engaging in market transactions Both parties feel like they are getting a good deal…engaging in a beneficial exchange….a win-win situation…

13. Laissez-faire Economics French for “to let alone” The founding principle of Capitalism