Question

strengths and weaknesses of free market capitalism?

Answer 1

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These are the advantages and disadvantages of free market capitalism:-

Advantage: Absence of bureaucratic procedure
For businesses, the most advantage of a free free enterprise is that the absence of bureaucracy and bureaucratic procedure . This reduces administrative costs to the business; money which the corporate can put into other endeavors like research and development.

Advantage: Freedom to Innovate
Free market economies enable business owners to innovate new ideas, develop new products and offer a wide range of new services. Entrepreneurs needn't depend upon government agencies to inform them when the general public needs a replacement product. they will study consumer demands, research popular trends and meet the customer's needs through innovation. Innovation also encourages competition among firms, when each firm attempts to enhance on the previous product generations by adding more and better features to existing products.firm attempts to enhance on the previous product generations by adding more and better features to existing products.

Advantage: Customers Drive Choices
In a free free enterprise , the purchasers make the last word decision on which products succeed or fail. When presented with two products that provide similar benefits, customers vote with their purchases and choose which product will survive. Customers also determine the last word price point for a product, which needs producers to line product prices high enough to form a profit, but not so high that customers will hesitate to form a sale .

Disadvantage: Limited Product Ranges
Since businesses are allowed to move in whatever direction they may want, goods and services that aren't profitable generally won't be produced. this will limit the range of products on offer to consumers and should impact certain groups of consumers quite others. for instance , if it's too expensive to ship goods to, or open services in, rural communities then services could also be withdrawn and these communities will miss out.

Disadvantage: Dangers of Profit Motive
The primary objective for any company during a free free enterprise is to form a profit. There have been instances where companies may sacrifice worker safety, environmental standards and ethical behavior to realize those profits. the initial 2000s saw such unethical behavior run rampant at companies like Enron and WorldCom. The Deepwater Horizon oil spill in 2010, one among the most important environmental disasters in U.S. history, was largely due to the utilization of substandard cement and other cost-cutting measures.

Disadvantage: Market Failures
When a free free enterprise spins out of control, the results are often severe. Historically the great Depression of the 1930s to the real estate market crash of 2008, market failures have devastated the lives of millions in lost income, unemployment and homelessness. Many of those failures fin their roots from short-term profit activities over slow and steady gains, usually aided by loose credit, highly-leveraged assets and minimal government intervention