Economic Systems

Question 1

Scarcity

Answer 1

The limited supply of something

Question 2

What are the three basic economic questions?

Answer 2

1. What goods/services will be produced?
2. How will goods/services be produced?
3. Who will consume the goods/services?

Question 3

Traditional economy

Answer 3

All economic decisions are based on customs, traditions, and beliefs of the past

Question 4

Bartering

Answer 4

Trading without using money

Question 5

Command economy

Answer 5

All economic decisions are made by the government

Question 6

Market economy

Answer 6

Economic decisions are made based on the changes in prices that occur as buyers and sellers interact in the market place

Question 7

Free enterprise

Answer 7

Competition between companies

Question 8

Most democratic countries have some characteristics of both systems, so we keep it simple and call them:

Answer 8

Mixed

Question 9

The Economic Continuum

Answer 9

How economically free a country is on a scale of 0-100

Question 10

Nation-state

Answer 10

Country (Japan, South Korea)

Question 11

Communism

Answer 11

A society where everyone owns everything. Government distributes wealth

Question 12

Capitalism

Answer 12

Private citizens own all means of production. No government control

Question 13

Human Resources

Answer 13

You. A person and their skills

Question 14

Supply and Demand

Answer 14

The amount of a product available and people’s willingness to purchase