What is a free-market?

“Intellectual freedom cannot exist without political freedom; political freedom cannot exist without economic freedom; a free mind and a free market are corollaries.” — Ayn Rand

A free-market is a market, where individuals (or groups of individuals) compete against each other to trade goods and services with other individuals (groups), under a legal system based on the protection of individual rights (capitalism), free from the coercive effects of the initiation of physical force (and its corollary, fraud).

Observe that the competition among buyers and the competition among sellers leads to cooperation between buyers and sellers, as the buyer and seller exchange values for mutual gain and mutual benefit (else no trade would take place).

[1] Ayn Rand “For the New Intellectual” 25

What is market competition?

Market competition between sellers for buyer’s money, and between buyers for seller’s goods/services results in cooperation between buyers and sellers when a trade is made.

What is a business?

A business (enterprise) is an organization that creates products/services to sell on the market with the goal of making a profit for its owners.

What are savings?

The profits from the business can be either spent on consumption or saved and reinvested. Savings is wealth that is not consumed.