Chapter 4-1 - Private vs. Public Sectors The private sector...

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1 Chapter 4 Section 1 The Market System Private vs. Public Sectors • The private sector is made up of households, businesses, and the international sector. • The public sector refers to activity by the various levels of government. • Productive activity occurs in both sectors. A basic problem is determining which sector can best produce a given good or service. The Market System • In the market system of the private sector, the consumer is supreme. Consumer Sovereignty : consumers determine what is produced through their purchases of goods and services. Profit and the Allocation of Resources When a good or service seems to have the potential to generate a profit, someone with entrepreneurial ability will put together the resources needed to offer that good or
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This note was uploaded on 01/01/2011 for the course ECON 101 taught by Professor E during the Spring '10 term at American College of Computer & Information Sciences.

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Chapter 4-1 - Private vs. Public Sectors The private sector...

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