Economic Systems
This type of economy lets individuals and companies decide what to produce with minimal government interference.
What is a market economy?
A person or company that makes goods to sell.
What is a producer?
Supply and ______ are market forces that influence the price of products.
What is demand?
In a command economy, the government does not get involved in deciding prices.
What is False?
Choosing to spend an hour playing video games instead of mowing the lawn is an example of this.
What is opportunity cost?
In this economy, the government owns all businesses and decides what products will be made.
What is a command economy?
The benefit you give up by choosing one option over another.
What is opportunity cost?
When only a few copies of a popular video game are available, what happens to the price?
What is it increases?
Taxes collected from citizens are often used for these services.
What are schools, roads, and parks?
Your favorite concert is sold out, so ticket prices on resale websites go up. This demonstrates what economic concept?
What is scarcity or supply and demand?
Most countries have this economy, which combines private businesses with government involvement.
What is a mixed economy?
The extra charge a government places on imported goods.
What is a tariff?
Competition among companies benefits consumers because it encourages this.
What is innovation?
In a mixed economy, who makes economic decisions?
Both private companies and the government.
A bakery lowers the price of cupcakes to sell more before they go stale. This is an example of what market principle?
What is supply and demand?
In this type of economy, customs and traditions decide what goods and services are produced.
In this type of economy, customs and traditions decide what goods and services are produced.
When there is only one company controlling an entire industry.
What is a monopoly?
A limited supply of resources leads to this economic problem.
What is scarcity?
A government places tariffs on imported electronics. Explain the economic reasoning.
To make imported goods more expensive than local products and protect domestic businesses.
Give two ways competition can benefit consumers.
Leads to better products and lower prices
Name one advantage and one disadvantage of a market economy.
Advantage – freedom of choice, encourages innovation; Disadvantage – economic inequality, less protection for workers and the environment
Resources like water, minerals, and trees used to make goods.
What are natural resources?
Explain how a company’s desire to make a profit can influence innovation.
Companies want to make more sales, so they create better or new products to attract customers
Name one advantage and one disadvantage of a command economy
Advantages - Greater income equality, basic needs are often met by the state
Disadvantages - Lack of consumer choice, Inefficiency (laziness), Little innovation
Explain the difference between profit and incentive in a market economy
Profit is the money a company earns from selling goods or services. Incentive is the motivation to produce goods or improve products to make more profit or satisfy consumer demand