TYPES OF ECONOMIC SYSTEMS

Question 1

name the three types of economic systems

Answer 1

1. free market economy
2. command economy
3. mixed economy

Question 2

what is the definition of a free market economy

Answer 2

a system in which privately owned businesses create goods and services

Question 3

what is the definition of a command economy

Answer 3

all economic ( business ) decisions are made by the government

Question 4

what is the definition of a mixed economy

Answer 4

combines free market and command economies

Question 5

name 5 characteristics of a free market economy

Answer 5

1. government rarely makes rules
2. citizens own all businesses
3. prices are set my demand an supply
   4 freedom of choice for citizens ( fulfil their wants )
   5.higher standard of living

Question 6

name 3 characteristics of a command economy

Answer 6

1. government decides things like production , quantities ,wages and distrubution go goods
2. no privately owned companies
3. government owns all businesses

Question 7

name 3 characteristics of a mixed economy

Answer 7

1. companies ad businesses are usually owned by citizens
2. government regulations for safety and well being of
   citizens

3.public education provided

Question 8

give examples of a market economy

Answer 8

Singapore

hong kong

Question 9

give examples of a command economy

Answer 9

china

russia

Question 10

give examples of a mixed economy

Answer 10

usa

Question 11

give 3 advantages of a market economy

Answer 11

1. produces receive incentives (rewards )
2. increase in the standard of living
3. increase in efficiency and productivity

Question 12

give 3 disadvantages of a market economy

Answer 12

1. job security is low
2. large gap between rich and poor
3. services available if they can afford it

Question 13

give 3 advantages of a planned economy

Answer 13

1. no unemployment
2. an equal distribution of wealth
3. services are available to all

Question 14

give 4 disadvantages of a planned economy

Answer 14

1. government owns everything
2. no freedom of choice
3. unable to promote economic growth and consumer satisfaction in the long term
4. produces are not motivated to work harder to earn more profit or to improve their business (no incentive )

Question 15

give 3 advantages of a mixed economy

Answer 15

1. combines Both market an planned system to create one
2. less unemployment an equal spread of wealth
3. social responsibility is seen as important

Question 16

give 2 disadvantages of a mixed economy

Answer 16

1. resources are not used to economic advantage

2. gov. regulations are not always beneficial to private enterprises