Capitalist Economy Essay

The right of mysterious space authority that productive factors such as land, factories, machinery, mines etc. are low private ownership. The owners of these factors are pardon to use them in the manner in which they wish. The government may however, put some restrictions for the benefit of the society in generalFreedom of enterpriseThis means that everybody engages in any economical activity he likes. More specifically he is free to inflexible up any firm to produce goods.Freedom of choice for the consumersThis means that state in a capitalist deliverance are free to spend their income as they desire. This is known as consumer sovereignty. Consumers are sovereign in the sense that makers produce only those goods which consumers are willing to buy.Profit antecedent In a capitalist economy, it is the profit motive which forces or induces people to work and produce Competition Competition prevails among the sellers to sell their goods and among buyers to obtain goods to in dulge their wants. Advertisement, price cutting, discount etc., are found to be the normal methods of contestation in any capitalist economy.Inequalities of incomes There is generally a replete(p) gap of income between the rich and the poor in the income which mainly arises delinquent to unequal distribution of holding in such economies.Merits of capitalist economyThe followers are the merits of capitalist economy1.To attract the consumer, the producer is in a position to bring out newer and finer varieties of goods 2.The existence of private property and the driving force of profit motive results in last standard of living 3.Capitalism works automatically through the price machine 4.The emancipation of enterprise results in maximum efficiency in exertion 5.All activities under capitalism enjoy the maximum amount of liberty and freedom 6.Under capitalism freedom of choice brings maximum satisfaction to consumers 7.Capitalism preserves organic rights such as right to freedo m and right to private property 8.It rewards men of initiative and enterpriseCountry as a building block benefits through growth of business talents, development of research etc.,Demerits of capitalismThe following are the demerits of capitalism1.In capitalism the enormous wealth produced is apportioned by a few. This causes rich richer and poor, poorer 2.Welfare is not protected under capitalism, because here the make is profit and not the welfare of the people 3.Economic instability in monetary value of over production, economic depression, unemployment etc., is very common under capitalism 4.The producer spends huge amounts of money on advertisement and sale promotion activities like fairs, exhibitions etc., 5.Class conflict arises between employer and employee and they will be paid low reinforcement and this leads to strikes and lock outs 6.Productive resources are mis employ under capitalism and they are used for the production on luxuries as they are bound to bring extrav agantly profits 7.Capitalism leads to the formation of monopolies and8.There is no security of employment for the workers and employees under capitalism. mentionhttp//classof1.com/homework-help/economics-homework-help/