1.1 Types Of Economies Flashcards
1
Q
What are the three types of economy ?
A
- Free Market Economy
- Mixed Economy
- Planned Economy
2
Q
What is a free market economy ?
A
Where scarce resources are allocated entirely by price mechanism.
3
Q
What is a mixed economy ?
A
Where scarce resources are allocated partly by the price mechanism and partly by the government.
4
Q
What is a planned economy ?
A
Where scarce resources are allocated entirely by the Government
5
Q
What is the advantage of Free Markets ?
A
- Competition and Efficiency
- Consumer Choice
- Incentives and Economic Growth
6
Q
What is the disadvantage of Free Markets ?
A
- Inequality
- Market Failure
