Traditional Economies
What is a traditional economy?
An economic system in which people produce and distribute goods according to customs/traditions
Where is the only true command economy left today?
North Korea
What is the primary incentive of a market economy?
Profit/Making money
What is the definition of a mixed economy?
A blend of two or more of the other economic systems.
What is the capital and second largest city in Scotland that is famous for it's castle which is the single most besieged castle in Europe.
Edinburgh
What’s the main incentive in traditional economies?
Survival
In a command economy who makes all major economic decisions?
The Government/Central Planner
What are the two markets that make up the Circular Flow Model?
Products Market and Factors Market
Give an example of a country with a mixed economy
The United States (or many other acceptable answers)
In what year were the crowns of England, Scotland, and Ireland merged together to create the United Kingdom?
Who decides what should be produced in a traditional economy?
The clan or tribe
Give an example of a command economy that has become a mixed economy today.
China, the USSR (now Russia)
Give an example of something that a Free Market System would not be good at
Lack of public goods/infrastructure
Who makes the economic decisions in a mixed economy?
A mix of the government, the producers and consumers, and traditions
What year was Topeka West built in?
1961
Where are the majority of traditional economies found?
In rural or underdeveloped areas.
Give one of the incentives in a command economy.
Bribes, being well connected, doing just enough
This term, originally coined by Scottish economist Adam Smith, refers to the idea that people pursuing their own best interest will still create benefits for society as a whole.
The Invisible Hand
What is the correct balance between economic freedom and government intervention in the market?
There is no one best answer, each society will answer differently.
What instrument was banned in 1746 as a "weapon of war" because of it's common use by rebellious Scots against the British armed forces, but was later played on battlefields in both world wars, including the storming of Normandy?
The Bagpipes
Traditional economies feature a heavy reliance on what for answering the key economic questions?
Tradition
Command economies may experience these if they don't produce enough of a certain good.
A Shortage
What is the role of the government in a Market Economy?
Buyers and sellers must be free to set fair prices with minimal government intervention.
Give one example of a mixed economy that leans more towards a free market system, and another that leans more towards a command system.
Command: China
(many other possible answers)
Adam Smith wrote his book, The Wealth of Nations after watching many people in his city become incredibly wealthy on the tobacco trade in North America. The Wealth of Nations is widely considered to be the first economics textbook, and is sometimes called the blueprint for capitalism. What city was Adam Smith living inspired by when he wrote this book?
Glasgow, Scotland