1. Free Enterprise System

2. Roles in Free Enterprise
Consumers
Consumers make their desires known through their economic dealings with producers
When consumers buy products, they signal to producers to produce more of that particular item
Review products to assist others in determining which products to purchase
Entrepreneurs
Bring together the factors of production

3. Economics in the Constitution
“Economic freedom plays a dual role in the promotion of a free society. On the one hand, freedom in economic arrangements is an end in itself. In the second place, economic freedom is also an indispensable means toward the achievement of political freedom.”
— Milton Friedman, Capitalism and Freedom

4. Economics in the Constitution
“no person shall be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”
— Fifth Amendment of the Constitution
Eminent Domain: the right of a government to take private property for public use
the government must pay the person the fair value of the property that has been taken

5. Economics in the Constitution
Taxation
Article I gives Congress the power to levy taxes
both individuals and corporations must pay federal income tax
Contracts
guarantees people and businesses the right to make contracts
individuals or businesses cannot use the political process to be excused from their contracts

6. Role of the Government
Americans have come to expect the government to take other actions to promote the public interest
One of the government’s important roles in the economy is to make sure that producers provide consumers with information
Congress has passed public disclosure laws, which require companies to give consumers important information about the products or services that they offer

7. Role of the Government Protecting Public Health and Safety
Environmental regulations
Quality standards
Usage restrictions
Regulation increased in the 1960s and 1970s, but decreased in the 1980s

9. Review What roles do consumers play in the Free Enterprise System?
Explain the concept of eminent domain.
What roles do the American people expect the government to play when it comes to the economy?