distribution of economic resources Flashcards
what are economic systems
the method that a country uses to distribute economic resource and trade goods and services
what is a free market economy
citizens are in control of economic resources they are free to set up buisnesses and can decide what goods and services are produced with very little interferance from the government
what are three benefits to a free market economy
-wide range of goods and services
-more competition and lower prices
-taxes are lower
what are three drawbacks to a free market economy
-less money spent on public services
-social welfare payments are low
-big gap between rich and poor
what is a controlled economy
control mainly lies within the government when it comes to distributing econnomic resources and making decisions the goverment decides what is produced
what are 2 benefits to a controlled goverment
-lots of public services
-resources are distributed evenly
what are 3 drawbacks to a centrally planned economy
-high taxes
-little choice
-high prices
whats a mixed economy
the goverment+ private individuals share the production of goods and services individuals can set up buisnesses provided you stay within the law
what are 3 benefits to a mixed economy
-wide choice for consumers
-essencial services are available to everyone
-public amenities
what are 3 drawbacks for a mixed economy
-limited income for all the public services that need to be produced
-high taxes
-more government regulations
what is the private sector of the ecomomy
part of the economy owned and controled by private individulas
what is the public sectors oft he economy
part of the economy owned by the goverment
what is the third/ voluntary sector of the economy
social cultural enterprises + not for profit orginisations
how does the local govermnet [public sector] work
the goverment gives money to each local authority whith is used to provide services in that area
how does the goverment departments work [ public sector]
there is 17 departments and each is run by a minister
what are state sponcered bodies [public sector]
they are run like buisneses but are run by the state
what is a non commercail state sponcered bodies + eg
state sponcered bodies that provide free services eg bord bia
what is a commercial sate sponcered body + eg
state sponcerd body that charges for its services rg rte
what are charities [voluntary sector]
set up to benefit others by raising money
what are social enterprises [voluntary sectors ]
enterprises that have a social or enviromental aim they are run like a buisness but their aim is to benefit the cause not the owners
whats a cultural enterprise
set up to promote culture , heritage + the arts most are commercial but some are non profit
what is the circular flow of income
the way in which resources and income move around the economy
how does the goverment add and reduce the flow of income
- add to the flow by spending on public services
-reduces it by charging extra taxes
how do foreign markets add and reduce the flow of income
- add to the flow through exports
- reduce the flow through imports
how do financial institutions add and reduce the flow of income
-they add to the flow by giving loans
-reduce by holding savings accounts
