The Free
Enterprise System
What Freedoms Do You Have?
 Speech
 Religion
 Assembly
 What
else?
Free Enterprise System
You are free to own property and start a
business in an economy based on the
free enterprise system.
What is an Economy?
 An
economy is a system for producing
and distributing goods and services.
What are Goods?


Goods are THINGS you can buy, like
shoes, soccer balls and CDs.
What are some other goods?
What is a Service?
 Service
is WORK that people do for
others. Hair stylists, plumbers and
doctors sell their services. Can you
name others?
O.K.…back to Free Enterprise
can decide what product you’ll
sell and how much money to charge
for it.
 You
History and Free Enterprise
 Our
nation was founded on the idea of
freedom.
 Americans have been participating in
the free enterprise system for
centuries.
History and Free Enterprise
Colonial Times - 1700s
When British colonists first
came to the New World,
they settled in three main
regions: New England, the
Middle Colonies, and the
Southern Colonies.
History and Free Enterprise

At first, colonial towns were
very self sufficient. The
businesses that grew
provided a living only for the
people that lived in them.
Jobs consisted of
shoemakers, blacksmiths,
printers, millers, dressmakers
and others that people
needed for daily living.
History and Free Enterprise
But, as the population
increased, the colonies
began to develop goods
that reflected the unique
aspects of the regions.
The dense forests and
deep natural harbors of
New England caused the
growth of businesses that
related to fishing,
shipbuilding, and
woodworking.
History and Free Enterprise

The rich farmland of
the Middle Colonies
caused farmers to
produce more wheat
and flour.
History and Free Enterprise
The large plantations
and small farms of the
Southern Colonies
were conducive to the
production of cotton,
indigo, and tobacco
crops.
History and Free Enterprise

At the same time, the development of
Spanish and French colonies in the New
World also created demands for goods.
Soon trading among the New World
colonies became very important.
History and Free Enterprise
As the world realized that profits could be
made in the New World, many conflicts,
battles, and wars were fought in order to
gain control Eventually our country
emerged free and independent of other
countries.
What’s a Profit?
Profit is the money a
business has left after it
has paid all its costs.
Your goal at Enterprise
City will be to pay off your
bank loan and make a
profit.
What are Costs?
Businesses must spend
money on certain things.
Taxes
Rent
Advertising
Supplies
Free Enterprise Leads to Invention
“… I find out what the world needs, then I
proceed to invent....”
Thomas Edison, American Inventor
Free Enterprise Leads to Invention
In 1868, Edison invented an
Electrical Vote Recorder, but
no one wanted to buy it.
He decided that from then on,
he’d only invent things that
people would want to buy.
Edison learned a hard lesson
about supply and demand.
What’s Supply and Demand?
Supply is how much of a product is available.
Demand is the amount of a product that people
are willing to buy.
If LOTS of people want it, you can charge a
higher price
If NOT MANY people want it, you’ll need to lower
the price.
Free Enterprise Leads to Invention
Thomas Edison was paid $40,000 for
his next invention. He used the money to
build a laboratory and continue inventing.
phonograph
electric light bulb
kinetoscope
Benefits of Free Enterprise:
Choice
You, the consumer, can choose
from many different kinds of
things to buy.
Benefits of Free Enterprise:
Progress
The free enterprise system inspires
people to invent things.
Remember Thomas Edison? His studio
produced the first talking motion
picture in 1912.
Benefits of Free Enterprise:
Profit
Entrepreneurs are people who
start businesses in order to
make money.
Madame C. J. Walker started a
beauty product line in 1906.
She became the first African
American woman to make
a million dollars!
Good Advice
“Don’t wait for
opportunities to come.
Get up and make
them!”
– Madame C. J. Walker
Good Luck!
We hope you’ll make the most
of your opportunities at
Enterprise City!
Bibliography
http://www.history.org/Almanack/life/trades/tradebla.cfmBlacksmiith picture
http://www.thomasedison.com/edquote.htm
http://www.bu.edu/webcentral/learning/fireworks2/graphics/thomas_edison.jpg picture of Thomas
Edison
http://www.imahero.com/photos/voterecorder1.html
Picture of vote recorder
http://www.kidcyber.com.au/topics/edison.htm
Pictures of kinetoscope and phonograph
http://www.madamecjwalker.com/
Madame C.J. Walker