ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A private enterprise system is based on the belief that when people are free to make economic choices and to set economic goals, they work harder to achieve those goals. These citizens also believe in limited government control and freedom of employment.

Detailed explanation-2: -As an economic system, private enterprise is characterized by competition, open markets, private ownership, and private initiative. Producers take production initiative on the basis of price and profit-and-loss signals essentially given by consumers.

Detailed explanation-3: -Entrepreneurs are important because they are willing to take risks to start new businesses, so they become the catalyst of the free enterprise economy. but some survive and a few even become wealthy. leading to new products, greater competition, more production, higher quality, and lower prices.

Detailed explanation-4: -The key ingredient of the free enterprise system is the right of individuals to make their own choices in the purchase of goods, the selling of their products and their labor, and their partici-pation in business structure.