Traditional economy
What is an example of a traditional economy?
A small village where families farm and fish using traditional methods
What are some disadvantages of a command economy?
-People have fewer choices
-Businesses have less freedom to innovate
What are some advantages of a market economy?
-Many choices for consumers
-Competition encourages innovation
What is a mixed economy?
A mixed economy combines the elements of both a market economy and a command economy.
Supply
The amount of something that is available.
What are some disadvantages of a traditional economy?
-Limited technology
-Few choices of goods and services
What is a command economy?
A command economy is an economy where the government makes most economic decisions.
What are some characteristics of a market economy?
-Businesses compete with each other
-Consumers decide what products are successful by buying them
-Prices are determined by supply and demand
What are some advantages of a mixed economy?
-Consumer choice and competition
- Government helps provide important services
Demand
The number of consumers who want it.
What are some advantages of a traditional economy?
-Everyone knows there role
-Strong sense of community
What is an example of a command economy?
The government decides how much food, clothing, or housing should be produced.
What are some disadvantages of a market economy?
-Some people may not be able to afford certain goods and services
-Businesses can fail if consumers do not buy their products
What are some characteristics of a mixed economy?
-Businesses operate freely
-The government provides services and regulations
-Both consumers and government influence economic decisions
Consumer
Someone who acquires goods and services for his or her own personal use.
What are some characteristics of a traditional economy?
-Hunting, fishing, farming, and gathering are common
-Decisions are based on tradition
-Goods are produced the way they have been for many years
What are some characteristics of a command economy?
-The government decides what to produce-
-The government decides prices
-The government may own businesses and resources
What is a market economy?
A market economy is an economy where consumers and businesses make most economic decisions.
What is an example of a mixed economy?
The U.S. economy
Producer
Someone who makes goods or offers services to others.
What is a traditional economy?
A traditional economy is based on customs, traditions, and beliefs that have been passed down from generation to generation.
What are some advantages of a command economy?
Resources can be sent
What is an example of a market economy?
A company creates a new product because people want to buy it.
What are some disadvantages of a mixed economy?
Balancing government involvement and business freedom a can be difficult.
Profit
Financial gain received by selling something for more than it cost to make it.