Lesson 13 pg. 42 - 47

Question 1

What three basic components of capitalism is the proficiency of the market economy owed to?

Answer 1

> property rights, freedom of enterprise and competition in a market environment, and limited government

Question 2

Describe intellectual property

Answer 2

> is result of creative labor, and may include the rights to a song, written work, computer program, or a patent to an invention

Question 3

What two entities make the majority of economic decisions in the free market?

Answer 3

The two entities–private households and private business–make the majority of economic decisions in the free market.

Question 4

Define circular flow model

Answer 4

circular flow model - simplified diagram illustrating how resources and products move through market

Question 5

List two components that the market has

Answer 5

> resource market, in which factors of production are sold

>product market, in which consumer products are sold