Short Synopsis of How Capitalism Works and the Good About It

“Capitalism is an economic system based on private property and the profit motive in which goods and services are produced, distributed, and consumed through free markets.” The dominate framework of capitalism is the land, the labor, and the capital; where the land is the raw materials that are used to make the goods or stuff that are needed to make the services possible, the labor is the people who are actually doing the work that is done to process the free market, and the capital is the money or tools used to make profit. Capitalism enables one to make more money if one has the ability to so one does not have to be on the same social class than others. People invest wealth on capital to make profit that turns into more wealth. Some of that wealth is being reinvested onto the capital to make even more profit that turns into even more wealth. In the definition of capitalism, profit motive is the desire to make money. The founder of the apple company wanted to make money and, therefore, created the apple company. The market price is the price buyers and sellers agree on. It is almost always higher than what the buyer wants to buy the product at and lower than what the seller intends to sell the products at. This way, buyers can buy products at a price they wish to pay and sellers can sell the product at a price where they can still make profit. The free market is all about competition and negotiation. The prices in free markets are not set and therefore people can compete and negotiate with prices. Capitalism enables social mobility and is led by the invisible hand. The invisible hand is thought as an actual hand or an angel that comes to lift things and make things work together. Without the invisible hand, people would not be able to work together to get what people want to need.