Economy Flashcards
When does an economy begin
When goods and services are frequently exchanged in a defined geographical area.
What are primary industries
Industries that extract from the ground, the sea or grow plants and raise animals
What are secondary industries
Manufacturing and factory work e.g packing
What are tertiary industries
Industries that provide a service e.g teacher
Benefits of free market economies
Freedom of choice
Lower prices
No government intervention
Cost of free market economies
Higher prices
Monopolies form
Negative externalities
Benefits of planned economies
Stops exploitive monopolies
No wasteful competition
Less negative externalities
Cost of planned economies
State may misjudge which results in over production or shortage
No incentive to work harder
Slow responsiveness to change
Benefits of mixed economies
Combines best of pe and fme
Government can regulate so equality
Cost of mixed economy
Combines worst of pe and fme
State run businesses have lack of efficency because of lack of competition
