Economic Systems Flashcards
Traditional economy examples.
Rural parts of India, parts of Africa, and the Inuit Tribe.
What is a traditional economy?
An economic system in which decisions are based on customs and beliefs.
Make what they always make and will do the same work as parents
Exchange of goods is done through: bartering- trading without using money.
You work for SURVIVAL not money.
What is the Command Economy?
☑️ Government makes all economic decisions and owns all property.
☑️ governmental planning groups determine such things as prices of goods/services and wages for workers.
☑️ this system has not been very successful and most countries are abandoning it.
☑️ GOVERNMENT‼️
Command Economy Examples
Former Soviet Union and North Korea
What is a Market Economy?
Production and distribution on questions are answered by prices and profits ( supply and demand)
Most resources are owned by private businesses.
Economic decisions are based on free enterprise ( competition between businesses)
Government doesn’t tell a business what goods to produce and how to charge them.
There are no truly pure market economies but the US and Australia is close.
INDIVIDUALS!
Market economy examples
The US and Australia are close
What is a Mixed Economy?
➰ Market+ Command= Mixed
➰ there are no pure command or market economies
Mixed economy examples
Brazil, Mexico, Canada, UK, US, Germany,Russia, Australia, and etc.
Economy System Questions:
〰 What to produce?
〰 How to produce?
〰 For whom to produce?
