The economic system of the United States is principally one of private ownership. This system is often called a "free enterprise system."
In the U.S. economic system, three groups make decisions on a daily basis: consumers, producers and the government. The interaction of these groups makes the economy function. The main force, however, is the interaction of producers and consumers, so the U.S. economic system is often called a "market economy."
Consumers usually look for the best values for what they spend, while producers seek the best price and profit for what they make and sell. Federal, state and local governments work to promote the public safety, assure reasonable competition, and provide a range of services, such as education, the postal service, and the road system.
Prices of goods and services are determined by supply and demand. Entrepreneurs develop their own businesses. They must provide goods or services of a quality and price to compete with others, or they are driven from the market.
Generally there are three kinds of businesses: single-owner operated businesses, partnerships, and corporations. The corporations combine the investments of many people who can buy or sell their shares of the business at any time on the open market. This enables the amassing of large sums of money and makes large-scale enterprise possible.
Source: A Mixed Economy-The US System
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