Economic Systems

Question 1

Economics

Answer 1

System in a nation to determine how goods + services are produced, distributed, + consumed/used

Question 2

Command economy

Answer 2

Communism + Socialism Gov has control over ALL economic decisions- central economic plan

Question 3

Command Economy Advantages

Answer 3

Eliminates un-employment, efficient (NR used), equal dist. of products

Question 4

Command Economy Disadvantages

Answer 4

No incentive (no reward) Monopoly Business (poorer quality, possible problems w/ production), Innovation is hard, buyer wants ignored

Question 5

Market Economy

Answer 5

Capitalism- lets supply + demand decide variables, private ownership

Question 6

Market Economy Advantages

Answer 6

risk + effort = gain (more incentive) private profit maximized, independence, innovation is easier, variety of options to work

Question 7

Market Economy Disadvantages

Answer 7

not much gov, regulation, unfair wages, unemployment rates are higher, “keeping up w/ the Jones,” big gap between wealthy + working class

Question 8

Mixed Economy

Answer 8

Most democracies, combines characteristics, gov is a big part in military, international trade, and national transport, investing is a big part, more efficient producers get higher profit (less equality but more individual rights)

Question 9

Mixed Economy Advantages

Answer 9

Distributes goods to where most needed, lets prices vary, innovation is easier, gov. can regulate things (minimum wage, health codes) (protects consumers, workers, + competition)

Question 10

Mixed Economy Disadvantages

Answer 10

Too much freedom leads to less competitive people w/o gov. support, defense industry can be monopolized