Distribution Of Economic Resources

Question 1

What is an economy

Answer 1

• An economy is the way in which goods and services are made, sold or used in a country or area.

Question 2

Centrally planned economy

Answer 2

• A centrally planned economy is one where the government makes all the decisions about how the economic resources of the country are used.

• All businesses are owned and run by the government and the people of the country are not involved in business ownership.

• Communism is the most extreme example of a centrally planned economy

• Cuba is an example of a centrally planned economy

Question 3

Free Market Economy

Answer 3

• A free market economy is one where private citizens control resources, own businesses and make all the decisions about how goods and services will be produced

• The government has little involvement in how the economic resources of the country are used

• The United States of America is an example of a free economy

Question 4

Mixed economy

Answer 4

• A mixed economy is one where both the government and private citizens have control over the economic resources

• The government control essential services for the people of the country like education and health

• Private individuals and businesses also produce goods and provide services to the citizens of the country
• Ireland is an example of a mixed economy

Question 5

Public sector

Answer 5

• The public sector is the part of the economy that is owned and controlled by the government

• This sector provides essential services to the public e.g health, education

Question 6

Three sections of public sector

Answer 6

1. Local government: provide a range of public services to a local area
2. National government: government departments that provide a range of services to the country as a whole
3. State-owned organisations: businesses set up by the government. They can be commercial (a business that charges money for their product or service) or non-commercial a business that provides services free of charge)

Question 7

Private sector

Answer 7

• The private sector refers to businesses owned by individuals that produce and sell goods and services with the aim of making a profit

• Example: Ryanair, Penneys, McDonalds

Question 8

Third sector

Answer 8

• The third sector of the Irish economy is made up of social enterprises and organisations that do not aim to make a profit e.g charities

• This groups work independently of the government and are often referred to as non-governmental organisations (NGOs)

Question 9

Charities (not for profit)

Answer 9

• Charities are set up to benefit others by raising money through various activities like collections, fundraising events and charity shops

• Charities depend largely on volunteers to help them provide their services

• Examples: Oxfam, Focus Ireland, ISPCA

Question 10

Voluntary organisations

Answer 10

• A voluntary organisation provides services for their members

• They raise money by charging a membership fee and by organising fundraisers

• Example: St Patricks Donabate GAA Club

Question 11

Social enterprise

Answer 11

• Social enterprises have a social or environmental aim

• They are run like a business and aim to make a profit to benefit a specific cause rather than for the owners

• Example: Donabate Credit Union