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
All economic decisions are based on customs, traditional & belfis.
The chances of goods being done is done through bartering
Bartering= trading without using money
command economy
All economic decisions 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 marketplace
free enterprise helps make these decisions
Free enterprise= competition between companies (shifting prices of goods /services)
Most democratic countries have some characteristics of both systems so we keep it simple and call them:
mixed
The Economic continuum
Is how free country is on a scale of 0 to 100
Nation-state
Country that is ethnically/ racially the same. (Japan)
Communism
system in which everyone shares wealth. goverment redistributed weather.
human resources
A person and their skills. You!
supply and demand
Amount of product available and people willing to buy the product.
capitalism
The industry is controlled by private citizens. Government inference
