Economic Systems Notes An ________________ describes how a country’s economy is organized. because of the problem of ____________, every country needs a system to determine how to use its productive resources An economic system must answer three (3) basic questions…

Economic Systems ________________________________? What kinds of goods and services should be produced? What productive resources are used to produce goods and services? _________________________________? Who gets to have the goods and services? The way a society answers these questions determines its economic system.

Four Types of Economic Systems: 1. _________________ Economy 2. _________________ Economy 3. _________________ Economy 4. _________________ Economy (Market + Command)

an economic system in which economic decisions are based on Traditional Economy an economic system in which economic decisions are based on _____________________________ People will make _________________ and will do the same work their ___________________did. exchange of goods is done through ____________ (trading without using money)

Who decides what to produce? Traditional Economy Who decides what to produce? people __________________and make what their _____________ made Who decides how to produce goods & services? people grow & make things the _________________________did For whom are the goods and services produced? ___________________who need them

villages in _______________________ ___________________in Canada Traditional Economy Examples: villages in _______________________ ___________________in Canada

_____________ makes all economic decisions & owns most of the property Command System _____________ makes all economic decisions & owns most of the property _________________________determine such things as the prices of goods/services & the wages of workers This system has not been _____________& more and more countries are abandoning it.

Command Economy Who decides what to produce? ____________makes all economic decisions Who decides how to produce goods and services? ________________ decides how to make goods/services For whom are the goods and services produced? whomever the ________________ decides to give them to

Command System Countries with __________________ governments have command economies Examples: _______________________ ______________________ *____________________________________ ___have moved away from having a command economy since 1991. Now they have a mixed economy.

Market Economy an economic system in which economic decisions are guided by the changes in prices that occur as ______________________ _________________________interact in the market place Based on what the people want! And how much they’re willing to pay! most of the resources are owned by ___________________________________ economic decisions are based on __________________________ (competition between companies)

Market Economy Who decides what to produce? businesses base decisions on ___________ ______________________________(PRICE) Who decides how to produce goods and services? ______________________ decide how to produce goods For whom are the goods and services produced? ________________________

Market Economy There are _________________________________ _____________, but the United States is close.

Mixed Economy _______________________________= Mixed There are no pure command or market economies. To some degree, all modern economies exhibit ____________________ ______________________________and are often referred to as mixed economies. Most economies are closer to one type of economic system than another. _______________________________and determine what and how to produce, but the ________________________________certain industries.

Who decides what to produce? ______________________ Mixed Economy Who decides what to produce? ______________________ Who decides how to produce goods and services? _______________but the government _______________________________ For whom are the goods and services produces?

Mixed Economy __________________________fall in this category (there are no truly pure market or command economies). Examples: __________________

Which economic system is best? The _______________has proven to be best because it promotes the goals of growth, freedom, & efficiency. Citizens are free to own their own property but are protected from corporate corruption. ________________________systems sometimes offer more security but are not nearly as strong in efficiency, growth, freedom, and environmental quality.