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oletarians (lower class).

Firms rationally aim to maximize profit and this is an incentive for production of these goods and services: The capitalists try to judge the market and adjust production accordingly in order to realize the greatest possible profit [8] .

In a pure capitalist economy, there is no state intervention which often means that the economy is free to make all economic decisions and adjust itself when necessary to remain in equilibrium.

PERFORMANCE UNDER CAPITALISM

In looking at the Performance under capitalism we evaluate the economy under the following performance criteria;

Economic Efficiency

Economic Stability

Income Distribution

Economic Growth

ECONOMIC EFFICIENCY

Being efficient is being able to accomplish a task with minimum expenditure on as many levels as possible. This performance criterion looks at how well the economy is able to allocate its resources to best maximize its production on goods and services while taking the welfare of individuals into consideration. A capitalist economy is efficient as it yields high levels of GDP, innovation is encouraged, and one is allowed to exercise freedom of choice.

ECONOMIC STABILITY

Unemployment rate, inflation rate and real economic growth are some of the economic indicators used to determine economic stability within the economy. Economic stability in a capitalist market is unstable due to fluctuations in inflation, unemployment as well as real economic growth.

INCOME DISTRIBUTION

Capitalism renders unequal distribution of income in the economy. Income is distributed in accordance to the skills and qualifications an individual possesses. Those possessing the skills, qualifications as well as capital resources valued by the market will receive high incomes, whereas lower incomes will be allocated to persons without such skills and resources.

ECONOMIC GROWTH

Economic growth can be measured as the increase in real GDP. Productivity is the key component, i.e. producing more at a lesser operational cost. Economic growth is said to be slow in a capitalist economy. With a steady rise in real GDP the economy is assumedly growing well. However, where there are fluctuations in the business cycle this may cause economic growth to be unstable suggesting that the economy maybe in or going through a recession.

ADVANTAGES & DISADVANTAGES OF CAPITALISM

ADVANTAGES

Capitalism, as we are aware, is an economy where resources and firms are privately owned in free markets. Normally, this usually involves some government intervention to regulate certain aspects of the economy and protect private property [9] . Several advantages are included within a capitalist economy.

Foremost as Government intervention is kept at a limited level several issues that generally arise with government intervention including corruption, lack of a self-interest push force and poor circulation of information within the market is prevented allowing individual incentives to work as hard as possible to achieve as much as possible.

As the capitalist economy is dependent on the push factor of individuals, there is no limit to the level of wealth an individual can accumu