Economics
SS7E5
SS7E5 a
Economic Systems
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When deciding how to use its limited resources, every country answers 3
questions about ______________ and ______________.
o
______________ will be produced?
o
______________will it be produced?
o
______________will it be produced?
How a country answers these questions depends on the type of economic
system they have.
Traditional Economy Overview

Based on ______________ and ______________ of a country. Economy is based on
______________ and hunting.

People will make what they always make; they will do the same work their
parents did.

Examples: Parts of Africa, India
Traditional Economy

What to produce?
 What people need to ______________.

How to produce it?
 Hunting, ______________, gathering (social ______________ determine who
does what)

For whom to produce?
 ______________ their own products (what they have always made)
Characteristics of Traditional

Found in ______________, ______________countries (some parts of Asia, South
America, and Africa)

______________ govern the economic decisions

______________ not used
Command Economy Overview

______________ owns and operates the factors of production.
Economics
SS7E5

The government would decide who would be farmers, what they would grow,
and how much would be turned over to the government.

Also called ______________, ______________

Examples: ____________________________, former Soviet Union, Cuba
Command Economy
 What to produce?
 Whatever the government _____________
 How to produce it?
 However the government decides
 For whom to produce?
 _____________ reward system; waiting in line/rations
Characteristics of Command

Government or other central authority makes decisions about and determines
_____________ natural, capital, and _____________ resources will be used.

Change can occur _____________, because its government driven

Little individual _____________

No _____________ between businesses
Characteristics of Command

_____________ often occur because of poorly run _____________ and farms

Government determines your _____________

Government sets the price of _____________ and _____________.
Market Economy Overview

Individuals _____________ and _____________ the buildings, machinery, property of
production.

Production and distribution questions are answered by _____________ and profits.

Businesses will make products, and provide services that will earn a _____________.

Standard of living is _____________ in this system.

Prices of _____________ depend on how much is _____________ and how many
people want it.

Examples: US, Great Britain, Japan
Economics
SS7E5
Market Economy
 What to produce?
 What people _____________ to buy and sell
 How to produce it?
 _____________ and _____________
 For whom to produce?
 Determined by how much someone is willing to _____________ for it
Market Economy Characteristics



Resources (capital and natural) are owned by _____________
Economic decisions are made by individuals _____________ to earn a profit
Individual _____________ is considered very important
Mixed Economy





Individuals own most _____________ and determine what and how to produce.
Government regulates _____________ industries.
Has features of both _____________ and _____________economies.
Example: China, most nations
The _____________ has a market economy but the government still has control over
wages, social security and some policies.
SS7E5 b
Most Countries…..


Most countries have a _____________ economy where they sway back and forth
between a pure market and pure command economy.
A __________________________ is an economy in which pure competition prevails. –
NO _____________ INTERVENTION
 A __________________________is an economy in which the government makes all
decisions. – NO _____________ = COMPLETE GOVERNMENT _____________
Economics
SS7E5
SS7E5 a
Economic Systems of SW Asia
Israel
Saudi Arabia
Econ Freedom
Index
Per Capita GDP
Exports
Imports
Trading Partners
Type of Economy

FYI: Saudi Arabia possesses 25% of the world's petroleum reserves and ranks as the
largest exporter of petroleum.
o
Government controls how profit is spent.
Turkey