This is a rather common question and shows how the software market today is actually quite weird. Before starting, remember that “free” in “Free Software” is about freedom and not about price. People do make money with FOSS. You will see how the development and sale of FOSS is much more intuitive than of proprietary software.
Some software meet a standard of excellence and are truly exemplar. That is the spirit of Free Software, the fact that programs can always be revised and improved. I'll make a list of these amazing software that are the state of the art technology of today and a proof of the power of Open Source and Free Software. For this article I will only include software that is notable and non-technical enough for everybody to enjoy.
GNU is an operating system that is developped by the GNU prject. The GNU project is part of the Free Software movement and aims to build a free (as in freedom) operating system. The project consists in gathering people around the world to develop software that is freely available and can be modified and distributed without restrictions. To license GNU, Richard Stallman created the GPL (General Public License) that is widely used today to license all sorts of Free Software. This license grants to the developer and to the users four basic freedoms to use, share, modify and distribute software.