Final answer:
In a free-market capitalist economy, inequality of income is expected due to skills and education disparities, supply and demand factors, and entrepreneurship and innovation.
Step-by-step explanation:
In a free-market capitalist economy, inequality of income is expected due to several reasons:
- Skills and Education: In a market economy, individuals with higher skills and education tend to earn higher incomes compared to those with lower skills or education. This leads to income disparities.
- Supply and Demand: Market forces of supply and demand determine the wages and salaries offered for different types of jobs. Jobs that require rare or in-demand skills tend to pay higher salaries and contribute to income inequality.
- Entrepreneurship and Innovation: In a market economy, individuals who successfully start businesses or introduce innovative products can earn high incomes, contributing to income inequality.
These factors, among others, contribute to the inherent inequality in a free-market capitalist system.