The Four Types of Economic Systems Flashcards
What are the four types of economic systems?
Market Economy
Traditional Economy
Command Economy
Mixed Economy
What is an example of a command economy?
An example of a traditional economy is, a road would be constructed if the people in power decided it fit into their plans and met their needs.
What is an example of a traditional economy?
An example of a traditional economy is, to decide to construct a new road, elders might be consulted, and the decision would be made according to the traditions of the people.
What is an example of a mixed economy?
The decision to construct a road would be made after discussions among governments, businesses, and consumers. The decision could rest in the hands of any or all of these groups.
What is an example of a market economy?
An example of a market economy is, constructing a road would be a decision made by a corporation, based on whether a profit could be made. Government might or might not be involved.
Suppose you had just written the Case Study about the command economy of North Korea. What are three different titles you might have given this Case Study?
Example: The three different titles I might have given this Case Study is
You are a farmer in North Korea just after the Korean War ended. Your farm has been collectivized by the government. Write a diary entry stating your feelings and opinions about this event.
Example:
July 30, 1953.
I’ve just gotten settled safely back into North Korea three days after the war. I am hoping to be able to get back to farming and supporting myself.
July 31, 1953.
My farm has just been collectivized by the government of North Korea. I am quite frustrated, angry, and confused. But I can not speak out or say anything. I will probably get rid of this diary entry soon, or I may be arrested if anyone sees this.
August 1, 1953.
I am no longer in control of anything related to my farm. I am in a way a slave. I am very very angry, but I can not do anything.
August 27, 1953.
Earlier today, some of the military went down the road near my farm. I approached them and asked about my farm and pleaded for them to give it back to me, as I feel like I can barely do anything with the farm not owned by me. The military threatened me with arrest and went on their way.
In your opinion, what is the greatest problem that North Korea faces? Explain your choice in a four-sentence paragraph.
Example: In my opinion, the greatest problem which North Korea faces is the food shortage. I say this because unlike the electricity shortage in North Korea, the food shortage is an actual requirement of life. For example, in North Korea, of all places, they do not need much electricity, and barely even understand the concept of electricity. Because of this, all the electricity could be shut down in North Korea but so long as the North Koreans have a source of light, such as a hand-crank flashlight, or a candle, they’d be fine. If there was an electricity shortage somewhere such as the USA, people would go crazy because they rely on phones, computers, tablets, electricity-powered lights, et cetera. So, the North Koreans would be much more concerned, panicked, and would go crazy if they had zero food instead of zero power.
Imagine that you had the opportunity to offer one suggestion for improving North Korea to the president of the country. What would be your suggestion? Explain your reasoning.
Example: If I had the opportunity to offer one suggestion for improving North Korea to the president of the country, my suggestion would be to make reusable nukes and missiles and lower the amount of money they’re spending on nukes and missiles and focus more on food supply. I say this because, clearly, North Korea is only launching missiles over and over to simply bring fear into other countries and places around the world, and especially so they won’t attack North Korea. But, if North Korea made reusable nukes and missiles, they’d be able to keep on launching what appears to be different nukes and missiles even though they are actually the same ones. They could make it seem as though the nukes and missiles are different by simply painting them different colors. The reusable nukes and missiles could be made by using a system similar to Elon Musk’s space shuttle system which safely lands them back on Earth. Since North Korea already has tons of land used for secret military camps, torture facilities, prisons, and more, they could probably make room for a place for the nukes and missiles to safely land for recollection. With the issue of buying new nukes and missiles over and over now gone, North Korea could put the money more towards farming and food supplies in order to make the North Koreans happier and doubt the leader of North Korea much less.
Who are the decisions made by in a traditional economy?
Decisions are made based on what has been done in the past. People organize their economic choices following custom and tradition.
Who are the decisions made by in a command economy?
Decisions are made by a central authority, such as a dictator or the government. Citizens are required to carry out these decisions; personal choices are few.
Who are the decisions made by in a market economy?
Decisions are made by all members of the society based on their own needs and desires. Citizens make economic choices through buying and selling in the marketplace.
Who are the decisions made by in a mixed economy?
Decisions are made within a system that has aspects of both command economies and market economies. Governments, businesses, and individuals are all included in economic planning and decision making.
Which country has a traditional economy?
The Yanomami Tribe.
Which country has a command economy?
North Korea.
