Which type of Economic System?

Economic system where tradition and custom govern economic decisions.

• Traditional

• Command

• Market

• Mixed

Combines elements of pure market and command economies; Government and individuals share the economic decision making process.

• Traditional

• Command

• Market

• Mixed

The government or other central authority makes all economic decisions.

• Traditional

• Command

• Market

• Mixed

Economic decisions are made by individuals competing to earn profits based on supply and demand.

• Traditional

• Command

• Market

• Mixed

Little or no use of technology.

• Traditional

• Command

• Market

• Mixed

Individual freedom is considered very important; individuals have freedom to make economic decisions.

• Traditional

• Command

• Market

• Mixed

The government sets the prices of goods and services.

• Traditional

• Command

• Market

• Mixed

Government serves to protect both producers and consumers from unfair policies and practices.

• Traditional

• Command

• Market

• Mixed

State planners in Country 1 met to decide what the country should focus on producing. After much deliberation, they decided it would be in the country’s best interest to use their limited resources to produce automobiles instead of other consumer goods, such as electronics or textiles. The state planners passed their decision down to factories, and allocated to them raw materials, workers, and other resources needed to produce automobiles. Factories were then told how much they should produce with these resources and who the final products should be shipped to.

Which type of Economic System does Country 1 have?

• Traditional

• Command

• Market

• Mixed

In Country 2, people rarely engage in market transactions. For the most part, they do not need to. Families grow their own vegetables and raise their own animals or hunt to get meat. Certain times get tough for people in Country 2, like when the winters are particularly cold or animals change their migration patterns. For this reason, it is important that families stock up in “good times” and develop relationships with neighbors with whom they can share or trade.

Which type of Economic System does Country 2 have?

• Traditional

• Command

• Market

• Mixed