Types of Economic Systems

What is an economic system?

• A method by which countries manage their resources and production.

• A system for predicting weather patterns.

• A network of ancient trade routes.

• A collection of historical documents.

What does scarcity mean in economic terms?

• Unlimited resources to fulfill all wants

• Limited resources to fulfill unlimited wants

• Equal resources for all wants

• No resources needed for wants

What does mutual dependence mean?

• Relying solely on oneself

• Relying on each other

• Not relying on anyone

• Relying on technology

Why do we depend on one another?

• Because everyone is equally skilled

• Because everyone has different skills

• Because no one has any skills

• Because everyone has the same resources

What is the main idea of the traditional economy?

• Everyone can do everything

• Everyone has something of value to offer

• No one has anything to offer

• Everyone relies on technology

Why do humans try to create symbiotic relationships?

• To increase competition

• To enjoy a quality of life

• To reduce costs

• To avoid work

What is a challenge for societies and governments regarding labor and production?

• Solving the questions of what, how, and for whom to produce

• Deciding who should be unemployed

• Determining the best way to increase taxes

• Finding ways to reduce population

What does the phrase "What, How, and For Whom" refer to in economic systems?

• The basic economic questions every system must address

• The questions only market economies answer

• The questions only traditional economies answer

• The questions only mixed economies answer

What is a characteristic of a centrally planned economy?

• Government makes all economic decisions.

• Decisions are based on consumer preferences.

• Decisions are made by private businesses.

• Decisions are made by individual households.

What is a Traditional Economic System?

• An economic system based on customs and traditions.

• An economic system where the government controls all resources.

• An economic system driven by supply and demand.

• An economic system with no private ownership.