Economic Systems Flashcards

Front

The three basic economic questions are

Back

What should be produced? How should it be produced? Who gets to consume it?

Front

What is the function of an economic system?

Back

To organize a society's production and distribution of resources.

Front

When customs dictate the economy, it is a

Back

traditional economy.

Front

When the government dictates the economy, it is a

Back

command economy.

Front

When individuals dictate the economy, it is a

Back

market economy.

Front

When individuals and the government dictate the economy, it is a

Back

mixed economy.

Front

What is the main incentive for people to actively compete in a market economy?

Back

the profit motive.

Front

In which system is the role of government to robustly regulate the market? Options: mixed, traditional, market, command

Back

mixed

Front

In mixed economies, the factors of production are owned

Back

publicly and privately.

Front

What is an important advantage of a free market?

Back

It offers a wide variety of goods and services