Ch. 2 Review

way in which a nation uses its resources to satisfy its people’s needs and wants

• Economic system
• Political system
• Religious system
• Educational system

system in which economic decisions are based on customs and beliefs that have been handed down from generation to generation

• Traditional Economy
• Market Economy
• Command Economy
• Mixed Economy

system in which the government controls the factors of production and makes all decisions about their use

• Capitalist System
• Mixed Economy
• Market Economy
• Command Economy

system in which individuals own the factors of production and make economic decisions through free interaction while looking out for their own and their families’ best interests

• Socialist system
• Communist system
• Capitalist system
• Feudal system

the process of freely exchanging goods and services between buyers and sellers

• Market

• Barter
• Investment
• Monopoly

economic model that pictures income as flowing continuously between businesses and consumers

• Circular Flow Model
• Linear Flow Model
• Square Flow Model
• Triangle Flow Model

system combining characteristics of more than one type of economy

• Mixed Economy
• Capitalist Economy
• Socialist Economy
• Traditional Economy

economic system in which private individuals own the factors of production

• Capitalism
• Socialism
• Communism
• Fascism

economic system in which the government minimizes its interference with the economy

• Free Market Economy
• Command Economy
• Mixed Economy
• Traditional Economy

economic system in which individuals own the factors of production and decide how to use them within legal limits; same as capitalism

• Socialism
• Communism
• Feudalism
• Free Enterprise