Summary Of A Crucial Function In A Free-Enterprise Economy

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As stated by Salvatore (2015), “profit serves a crucial function in a free-enterprise economy” (p. 19). Further reasoning would suggest if a company is generating profits, there must be adequate demand for their product or service. What determines which products are acceptable to supply given adequate demand, but also a moral dilemma? The most popular example of this catch-22 proposition is regarding cigarettes. Should the continued existence of a cigarette market be allowed given their known link to cancer and other health issues? The answer to this question, as well as the question in general regarding what a business can produce and sell, lies in the system of free enterprise. Our current system of capitalism is founded on free enterprise,

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