Question
Asked Sep 26, 2019
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  1. Please explain in detail what would happen to our capitalist system when it is confronted with limited global resources and limited global markets.
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Expert Answer

Step 1

Capitalism is an economic system in which there is least government intervention. Private firms and companies are the owners of the factors of production like capital goods, labor, natural resources and entrepreneurship. The primary objective is profit maximization.

Step 2

Thus, we can say that capitalism involves free market economy. This means for successful working of capitalism, all the resources required to undergo production process must be available at cheap prices. Thus, to establish, business entities prefer locations where there is easy access to resources and at least possible prices.

Step 3

Globalization plays a vital role here. As it increases the scope of availability of resources at cheap prices. Also, global marketing leads to efficiency...

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