Competition & Free Enterprise – Flashcards
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Which situation is the best example of competition in an economic system?
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A small CD store slashed its prices to attract customers from a larger store that sells CDs and DVDs.
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In a competitive market, a furniture company decides to use cheaper materials to decrease production costs and pass on the savings. This is an example of
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lowering prices for customers.
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What kind of economy uses a free-enterprise system?
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a market economy
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What is one downside to competition in a free-enterprise system?
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Consumers must be knowledgeable.
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In free-enterprise systems around the world, there are
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some restrictions on business ownership and business activity.
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Which is an example of regulation in the automobile industry?
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the creation of fuel-efficiency standards for cars
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In the United States, the government creates laws and regulations that business activities to prevent wrongdoing
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Limit
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Why does the US government create regulatory agencies? Check all that apply.
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1,4,5
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In a free-enterprise system, producers decide
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How much to change.
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What is regulation in an economic system?
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Regulation is the placing of limits or restrictions on business activity by the government.
