economic systems Flashcards
whata are the three needs and wants of a collective
- eductaion
- health
- public transport
what is an economic system
a system that decides whihc needs and wants are more importnat for a population
what are the three thi ngs an economic system needs to incorpatre
- law and order
- rules and regulations
- practices which are accepted by the population
what are economic systems designed to do
they are designed to answer four questions
- what to produce
- how to produce
- how much to produce
- for whom to produce
what is a pure market economy
in this system all resoucres are owned by private individuals who make decisons based on thei self interest
what is a planned market economy
in this system the government controls the economy and all factors of production are state owned
what is a mixed market economy
in this system it has characteristics of both planned and pure market economies, where governments control some of the resources but there is also private ownership
what are the characteristics of markets
- they help allocate scarce resoucres in order to satisfy the many competing wants in an eonomic system
- decsions are made between buyers and sellers in a decentralised way
- a market provides incentive for both consumers and producers
what are the three elemnts of markets
buyer (demand)
sellers ( supply)
something to exchange (goods/services/resources)
defien monopolies
one dominant firm
define oligopolies
a few dominant firms
what is a competative market
competative markets have large number of buys and sellers where no individual buyer or sller can influence the price, it also has easy entry into the market
what is a non-comepetative market
non competative markets have a small number of firms where these firms are price setters and entry into the market is restricted
