Types of Economy

Question 1

What are the three main types of economy?

Answer 1

1. Command Economy
2. Free Market Economy
3. Mixed Economy

Question 2

What is the command economy?

Answer 2

The command economy is where the country’s economy is controlled by the government.

Question 3

What country today is still has a command economy?

Answer 3

North Korea

Question 4

What does the government do in the command economy?

Answer 4

Set prices for everything
Decide what products to sell
Set wages for everyone

Question 5

What is the free market economy?

Answer 5

The free market economy is where there is no government intervention in the country’s economy.

Question 6

Are there any countries today that have a free market economy?

Answer 6

No

Question 7

What happens in a free market economy?

Answer 7

There are no laws on wages so people decide what they get paid.
Products are sold at prices people are willing to pay for.
The government doesn’t provide any support or benefits.
People do not pay the government taxes.

Question 8

What is a mixed economy?

Answer 8

The mixed economy is where the government has some intervention over the country’s economy.

Question 9

How many countries have a mixed economy?

Answer 9

99.9% of all countries

Question 10

What does the government provide in a mixed economy?

Answer 10

Benefits and Support
Pensions
Minimum Wage