5.1 Economic Systems DOL

In a traditional economy, what determines the production of goods and services?

• Market trends

• Government

• Individuals

• Traditions and customs

With whom does the most power lie in a market economy?

• Bankers

• The state

• Corporations

• The military

Which forces play the greatest role in determining the distribution of goods and services in a free market economic system?

• Court rulings and expert opinions

• Government officials and military needs

• Producer supply and consumer demand

• Village elders and community tradition

John lives in a country where the government plans their economy. The government decides what to produce, how to produce it, and how to set prices. What economic system does John’s country have?

• Market

• Command

• Traditional

• None of the above

Explain the key differences between a traditional, market/capitalist, and command/socialist economy.