Why is the right of private property an essential characteristic of a market system?
Please provide the best answer for the statement.
Property rights are important because they give people private ownership of resources. This ownership encourages them to make the best use of those resources because they will benefit if they do. Property rights also encourage people to take the risk of investing in capital goods or to develop new innovation or products because they will receive the benefits from this activity if they are successful. Property rights offer incentives for people to maintain their property to preserve its value and invest in it if they think they can increase its value. Property rights also facilitate exchanges by making clear who owns a resource so that there is no question about the legitimacy of the transaction.
You might also like to view...
Specialization is another word for
A) pursuing one's comparative advantage. B) the division of labor. C) producing at a comparably lower opportunity cost. D) all of the above. E) none of the above.
The above table shows the marginal benefits and costs from production of fertilizer. There are no external benefits. If the market is perfectly competitive and unregulated, the equilibrium price per ton will be
A) $70. B) $80. C) $90. D) $100.
The market for U.S. cars was impacted significantly by consumers' options to buy which of the following?
(a) Used cars (b) New cars produced by U.S. producers (c) New cars produced by foreign producers (d) All of the above
An increase in the price of a nonlabor input such as oil will cause
A) a movement down the SRAS curve. B) a movement up the SRAS curve. C) a leftward shift in the SRAS curve. D) a rightward shift in the SRAS curve. E) no change regarding the SRAS curve.