Final answer:
The three characteristics of the free enterprise system are economic freedom, competition, and voluntary exchange.
Step-by-step explanation:
The three characteristics of the free enterprise system are:
- Economic freedom: In a free enterprise system, individuals have the freedom to make economic choices as both producers and consumers. They can decide what to produce, how to produce, and for whom to produce. Consumers can decide what to purchase and from which companies to do business with.
- Competition: Competition exists among sellers, which helps to keep prices low for consumers. Producers compete with each other to attract and keep customers, while buyers compete with each other to find the best products at the lowest price.
- Voluntary exchange: Both buyers and sellers have the freedom to enter into the marketplace to buy or sell products. Sellers must believe that what they are selling is worth the price they are charging, while buyers must believe that the product they want to purchase is worth the money they will be exchanging for it.