economic systems Flashcards
1
Q
4 economic systems?
A
- traditional
- pure market
- pure planned
- contemporary mixed
2
Q
traditional economy?
A
-undeveloped
-according to customs and beliefs
- based on needs for survival
- focused on family/tribe
- long term focused
3
Q
pure market economies
A
- demand is key (what is profitable)
- allocative efficiency
- production & distribution of output and incomes
- no government involved
-private property - freedom/self-interest
- competition
4
Q
pure planned economies
A
- central authority plans
- controlled by government
- consumers have no freedom (assumed)
- resources allocated by government
- prioritises g/s production and supported by laws
5
Q
contemporary mixed economies
A
- private sector and gov owned
- balanced (relative scarcity)
- supply & demand
- self interest
- improve outcomes
- reduce market failure
6
Q
market failure
A
resources are not allocated to maximise consumer satisfying
