Types of Economic Systems
market economy is when
sellers chose to produce based on consumers choices. Buyers and sellers work together through supply and demand to set prices. People have a high degree of freedom, and businesses are privately owned.
What economy is the United Kingdom
mixed economy that leans toward the market side
A tariff is a
is a tax on imported goods. This causes prices to rise and discourages trade
Human capital
the education, training, and health of workers
command economy is when
the government decides what will be produced, how much to produce, and what prices will be. There is little competition, and the government owns most resources and businesses.
What economy is Germany
mixed economy, but it leans slightly more toward government involvement
A quota
limits the quantity of a product that can be imported.
Capital resources
machines, factories, tools
traditional economy is
based on customs and traditions passed down through generations. Because people do things the same way their ancestors did, these systems tend to have little change or innovation.
What economy is Russia
mixed economy, but it leans heavily toward the command side.
An embargo
completely stops trade with another country.
Natural resources
oil, minerals, water, fertile land
mixed economies is
combined elements of both market and command systems. A mixed economy allows private businesses to operate, but the government also regulates or controls certain areas to protect citizens.
is it possible for a county to be 100% market economy
no
Is it possible for a county to be 100% command
no
Entrepreneurship
people who start new businesses and create new ideas
However, trade can be limited by
trade barriers