Staab_H_M5_A2.docx - Creative Capitalism Hailey Staab October 16th 2017 Argosy University BUS201 Creative Capitalism Capitalism has benefited people all

Staab_H_M5_A2.docx - Creative Capitalism Hailey Staab...

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Creative Capitalism Hailey Staab October 16 th , 2017 Argosy University – BUS201
Creative Capitalism “Capitalism has benefited people all over the world. However, it has also caused others to be living in poverty and struggling to improve their lives.” In a system of capitalism, as people’s wealth rises, the financial incentive to serve them rises. As their wealth falls, the financial incentive to serve them falls, until it becomes zero. We must find a way to make the aspects of capitalism that serve wealthier people serve poorer people as well. The genius of capitalism lies in its ability to make self-interest serve the wider interest. The potential of a big financial return for innovation unleashes a broad set of talented people in pursuit of many different discoveries. This system, driven by self-interest, is responsible for the incredible innovations that have improved so many lives. A capitalist system and a free market system are economic environments where supply and demand are the main factors of price and production of goods and services. Although the two economic systems are based on the law of supply and demand, these systems are different. Capitalism is an economic system based on ownership of the factors of production. Some key features of capitalism are competition between companies and owners, private ownership and motivation to generate a profit. The production and pricing of goods and services are determined by the free market, or the supply and demand. A free market system is an economic system based solely on demand and supply, and there is little or no government regulation. In a free market system, a buyer and a seller transact freely only when they voluntarily agree on the price of a good or a service. Creative capitalism, on the other hand, focuses on the possibility of expanding capitalism into new areas and using it to solve problems that were previously assigned to charity or to government. The free market system is made up of six main characteristics. Those aspects are private property, freedom of choice, motive of self-interest, competition, system of markets and prices, and limited government. Most goods and services are privately- owned. The owners can make legally-binding contracts to buy, sell, or lease their property. Owners are free to produce, sell and purchase goods and services in a competitive market. They only have two constraints. First, is the price at which they are willing to buy or sell. Second is the amount of capital they have. Everyone sells their

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