Transcript Key Economic Principles of Free Enterprise

Key Economic Principles of Free
Enterprise
Ms. Cichon
Free Enterprise
System in which economic agents are free to
own property and engage in commercial
transaction
Effective Managers…
• They are able to identify the needs of
consumers and adjust their agribusinesses to
meet those needs quickly and efficiently
Economic Principle
Basic premises that explain
the free enterprise system
Diminishing Marginal Utility
When a product or service is consumed, a time
comes when the utility (or pleasure or benefit)
of consuming that product or service declines.
Demand
Relationship between price and quantity that
illustrates how much consumers are willing
and able to purchase at various prices.
Demand
Demand Shift
Supply
Relationship between price and quantity that
illustrates how much producers are willing to
supply at various prices
Supply
Supply Shift
Equilibrium Price and Quantity
Point at which the supply and demand
schedules intersect and at which the quantity
offered for sale matches exactly the quantity
that consumers are willing to purchase.
Equilibrium Price and Quantity
Equilibrium Price and Quantity
Economic Opportunities
Possible business prospects available in today’s
global economy