General Info.
What are the three basic economic questions each society must answer?
What, How, and for Whom to produce
Who decides what, how, and for whom to produce things in a traditional economy?
Traditions/Customs
Who decides what, how, and for whom to produce goods and services in a Market Economy?
What is the Consumer
Who decides what, how, and for whom to produce things in a command economy?
What is the government or central authority/leader
Who decides what, how, and for whom to produce goods and services in a Mixed Economy?
Combination of traditions, government, and consumers
True or False: Only the most wealthy societies must answer the 3 basic economic questions.
What is False
True or False: Traditional Economies barter/trade.
What is true
The circular flow model tracks this.
What is flow of money
True or False: No basic needs of people are met in a command economy.
What is False
True or False: In a Mixed Economy, the advantages and disadvantages are the same.
What is True.
What are goods and services?
Goods-merchandise/possessions
Services-the action of helping or doing work for someone
Name 2 places in the world where Traditional Economies exist?
Australia, Africa, India, etc.
What shape does the circular flow model use to represent the flow of money in our economy?
What is a complete circle.
Name 2 places in the world that have command economies.
North Korea
Cuba
China
Etc.
Give an example of a country that has a Mixed Economy
United States
True or False: The way a society answers the three economic questions will depend on its economic goals and social values.
What is True
Name two advantages of a Traditional Economy.
Economic roles are set
Stable, predictable, and continuous
Etc.
Name 2 advantages of a Market Economy
Individual Freedom for all
Lack of government interference
Incredible variety to choose from
High degree of consumer satisfaction
Name two advantages of a Command Economy.
Basic Needs taken care of
Education, public health, other services cost very little if anything
Very little unemployment
What is the most popular economy in the world?
What is Mixed Economy
Why does each society have to answer the 3 basic economic questions?
Because they have limited resources.
Name two disadvantages of a Traditional Economy
Discourages new ideas
Lack of progress
Lower standard of living
Etc.
Name 2 disadvantages of a Market Economy
Rewards only productive people
Workers and businesses face uncertainty (Competition)
Not enough public goods (Education, health, defense)
Unemployment
Name 2 disadvantages of a Command Economy.
Doesn’t meet wants
Incentives
Requires a large bureaucracy
New and different ideas are discouraged
No room for individuality
Name 1 advantage and 1 disadvantage of a Mixed Economy
Some government involvement, consumer driven, aspects of economy based on traditional values