Types of economies

Question 1

List the 4 types of economies

Answer 1

.Traditional economy
.Command economy
.Free market economy
.Mixed Economy

Question 2

Give three advantages of a command economy

Answer 2

.Welfare is maximised-minimising inequality
.Low unemployment-try to provide everyone with a job and a salary
.Prevents monopolies

Question 3

Give two disadvantages of a command economy

Answer 3

.Poor decision making-govt are slow and make poor decisions
.Restricted choice-consumers have limited choice
.Lack of risk taking and efficiency
.No incentive to increase inefficiency+no need to make profit

Question 4

Give 3 advantages of a free market economy

Answer 4

Efficiency
Got to offer best price on quality
Entrepreneurship-Market and economy rewards good ideas
.Choice-not just limited to buying what the government recommends

Question 5

Give 2 disadvantages of a free market economy

Answer 5

Inequalities-huge differences in wealth
Non profitable goods not made-street lighting, care and medicine would not happen as no profit is made
Monopolies-successful firms can grow and dominate the market