Free Market System In Alexa By Michael And Mathew

Free market is often a term used to describe buyers and sellers in a market who can buy and sells goods at any given price. Rational buyers are part of the market and are said to buy the product if he or she thinks its worth it. This is said to lead to optimal satisfaction. A free market system maximizes the overall good of society. In a free market any good can be sold at any time, its just whether the customer will buy it In the story of Alexa, Michael and Mathew, Alexa gets to set the price of her car. Michael and Matt being the buyers of the market, they get to choose whether to buy her car or not. This illustrates the fact of an open market. There is a seller who sets a price and two buyers, which makes this a free market. Michael thinks …show more content…
The reason this system is flawed is that not everyone is happy. People bargaining does not lead to optimal happiness because sometimes even if the buyer wins the item, he or she isn’t happy because they paid so much money for it. Also many people fall into issues with having to purchase something for a high price because it is a necessity. This also goes for sellers if they have to sell something to pay rent that month. An example would be Alexa. Alexa could have wanted more money for her car but at the same time she could have had to pay for her surgery. Another flaw in the free market could be the fact that it allows sellers to only sell to those who they want to. An example could be if a deli shop only wants to sell to Italian people they can. It is possible that a free market does not maximize the overall good of society because it allows buyers and sellers to not reach optimal happiness due to having to buy or sell something. This economic system could work if citizens don’t go outside the lines and take advantage of the free …show more content…
It allows buyers and seller to find a happy medium for the price of the product. Utilitarian’s are all about maximizing happiness and any situation that creates happiness. In turn the increase in productivity leads to more wealth in society. This all turns into a better way of life for all citizens and that why it’s the best economic system. Capitalism is the best system for generally increasing citizen’s quality of life. This is what Adam Smiths argument is for Capitalism. I believe the competitiveness in this system is what drives people of the market to buy and sell goods. Productivity and efficiency will lead to citizen wealth in this economic