2.03 Key Terms

Question 1

Command Economy

Answer 1

An economic system in which all or many of the means of production and distribution are owned and controlled by the government

Question 2

Communism

Answer 2

A command economic system in which the government controls the economic system and does not allow private ownership of the means of production and distribution

Question 3

Economic System

Answer 3

The organized way in which a country handles its economic decisions and solves its economic problems

Question 4

Market economy

Answer 4

An economic system in which the questions of what, how, and for whom goods will be produced are answered by individuals and businesses in the marketplace

Question 5

Socialism

Answer 5

A modified command economic system in which government owns the basic means of production and allows private ownership of businesses as well

Question 6

Traditional economy

Answer 6

An economic system in which people produce only what they must have in order to exist; all economic decisions are based on habit and tradition