Economic Systems Flashcards
scarcity
The limited supply of something
What are the three basic economic questions?
- What goods/services will be produced
- How will goods/services be produced
- Who will consume the goods/services
Traditional Economy
Customs, Traditions, and beliefs.
Barteing
Trading without using money.
Command Economy
All economic are made by the government.
Market Economy
Economic decisions are made based on the changes in prices that occur as buyers and sellers interact in the market place.
Free enterprise
Competition between companies (shifts prices of goods/services)
most democratic countries have some characteristics of both systems, so we keep is simple and call them…
Mixed Economy.
The Economic Continuum
How equally free a country is on a scale of a 0-100
Nation-State
A country with a government
Communism
Everyone is equal and all property is communally owned.
Capitalism
Everything is privately owned and ruled by free competition.
Human Resources
Workers and their skills.
Supply and Demand
Amount of a product and people’s’ willingness or ability to purchase it.
