StudentShare solutions
Got a tricky question? Receive an answer from students like you! Try us!

Essay example - Free Market Economy

Only on StudentShare
Pages 8 (2008 words)
The supplier wants to sell his products as high a price as possible. On the other hand, the buyer wants to buy goods(Parkin, 1998) and services as low priced as possible. The free market economy facilitates the needs of both parties because they are not forced to offer or accept a price against their will…

Extract of sample

The restrictions include both the ownership and exchange of commodities. In this type of economy, the price of each item or service is agreed upon with the mutual consent of sellers and buyers. The seller is free to offer how much he wants to sell his products or services. Likewise, the buyer is free to bid for the purchase price he wants or needs to buy the product or service he or she craves for. The free market economy is similar to laissez fair economy where the economic condition in the real world is mostly confining government intervention in economic matters as a regulating against force and fraud among market participants. Therefore, with the country's government force limited to a defensive role, government does not ignite the spark in the marketplace. The government, in this scenario has the economic role to levy taxes in order to finance the smooth flow of the free market economy. In the extremely free market economy, its advocates strongly denounce the government's tax intervention.
On the other hand, the opposite to free market economy is a controlled market. In this type of economy, supply and price are set by a government. ...
Download paper
Not exactly what you need?

Related papers

Free Market System.
This is more of a hypothetical situation as no economy in the world is in a total Laissez-faire state. As opposed to planned economy, the free-market economy allows households and private firms and businesses to own land and other resources and use them to invest in any part or sector of the economy which seems lucrative and profitable to them (Rao, 1998). In order to understand the benefits of…
9 pages (2259 words)
Free market in the economical world and business
Explain how the system works to allocate resources The allocation of resources depends on supply and demand of those resources in a free market economy. The buyers and sellers, or their agents undertake all the exchanges and transaction voluntarily (Friedman, 2003: 36). Both the seller and the buyer accept the transaction because both expect to gain from it. Consequently, the two may repeat the…
12 pages (3012 words)
the role of government in a "free market economy"
The transaction between the buyer and seller fosters cohesion and a free market. Competitive and free economies allow sellers to meet customers’ demands according to their likings and distribute inputs among manufacturers. Division of labor is important in an organization because it facilitates a balance in the economy to reduce the cost of production (Mathur par 2). The government plays a…
5 pages (1255 words)
To what extent do you agree with free market economies being more effective than a mixed economy ?
The following are some of the mixed economies where with illustrations indicating statistics of government spending in relation to GDP: Sweden 57%, France 52.8%, Iceland 57%, USA 38 %, China 20%, UK 47.3, and Hongkong 18.6%. There are other countries as well. Such economies are government managed while the rest are individual or private firms managed. As the economies grow, the government usually…
4 pages (1004 words)
To what extent do you agree with free market economics being more effective than a mixed economy
This explication espouses each system’s demerits and merits, and concludes with a statement of the better market economy of the two. A mixed economy permits parallel operation of private and public entities. The privatized businesses and the government share the control of monetary systems. The government takes control of the financial sectors that it determines significant to security and…
4 pages (1004 words)
to what extent do you agree with free market economics being more effective than a mixed economy?
In a traditional economic system, there is no control and everyone can produce goods for themselves. The countries which follow this economic system have low GDP and they have high government regulation of business. A good example of a country that uses this economic system is Bangladesh (Pryor, 2006). On the other hand, a planned economic system is the one where all economic activities are…
4 pages (1004 words)