Economic Systems Flashcards
Scarcity
The limited supply of something
When developing the economic plan each country must ask three basic economic questions?
What good/services will be produced?
How will goods/services be produced?
Who will consume the goods/services?
The way a country answers these questions determines what kind of economic system it will have?
customs, traditions, and beliefs
Bartering
Trading without using money
Command economy
All economic decisions are made by the government
Market Economy
Economic decisions are made on the changes in prices that occur as buyers interact in the marketplace.
Free enterprise
Competition between competition
Most democratic countries have some characteristic of both system, so we keep it simple and call them?
Mixed economy
Economic Cotinuum
How economically free a country is on a scale of 0-100
Nation-state
Country that is the same ethnic group
(example japan)
Communism
Everyone is the same and all wealth and property are commonly owned
Capitalism
industries are owned by private individuals no government interference
Human resources
Person and their skills
Supply and demand
the amount of product available and peoples willingness to buy the product
