Economic Systems and Their Characteristics

The video introduces the concept of economic systems, explaining how countries allocate resources to produce and distribute goods and services. It covers four types of economic systems: traditional, market, command, and mixed. Each system is described in terms of resource allocation, decision-making, and economic growth. The video also discusses the role of government and private sectors in mixed economies, using examples like the Maldivian economic system.

What are the three fundamental questions every economy must address?

• What to consume, how to consume, and when to consume

• How to save, how to invest, and how to spend

• How to trade, where to trade, and with whom to trade

• What to produce, how to produce, and for whom to produce

In a traditional economic system, what primarily influences resource allocation?

• Technological advancements

• Traditions and societal values

• Market demand

• Government policies

Which economic system is most likely to rely on agriculture and hunting?

• Market economic system

• Traditional economic system

• Command economic system

• Mixed economic system

Which economic system is characterized by low economic growth due to limited resource exploitation?

• Market economic system

• Command economic system

• Mixed economic system

• Traditional economic system

Which of the following is a characteristic of a market economic system?

• Resource allocation is based on traditions

• Resources are allocated by a central authority

• Government decides what to produce

• Private individuals and companies make production decisions

What is the main objective of individuals in a market economic system?

• Following government directives

• Maximizing social welfare

• Achieving economic equality

• Maximizing profit

How is the price determined in a market economic system?

• By government regulation

• By traditional customs

• By international agreements

• By market forces of demand and supply

In a command economic system, who primarily makes the decisions about resource allocation?

• Individual consumers

• The government

• Private companies

• International organizations

Which economic system features a combination of government and private sector roles?

• Traditional economic system

• Market economic system

• Command economic system

• Mixed economic system

What role does the government play in a mixed economic system?

• It only regulates international trade

• It implements policies and provides subsidies

• It controls all aspects of the economy

• It has no role at all