EconomicsEconomicsI can explain the different types of economies and give solid examples of each.

4 Types of 4 Types of Economic SystemsEconomic Systems

Traditional Command Market Mixed

Traditional EconomyTraditional Economy Family or Community based economic

system that relies on custom and rituals to make its choices. (past down from one generation to the next)

Examples: Aborigines Amazon Tribe Third World Countries

The three worlds as they were separated during the Cold War era, each with its respective allies.      First World: the United States and its allies.      Second World: the Soviet Union and its allies.      Third World: Non-aligned and neutral countries.

Command EconomyCommand Economy Government makes all the decisions Examples:

Cuba China Any Communist country or Dictatorship

Market EconomyMarket Economy Individual business owners make the

decisions based on consumer choices

Mixed EconomyMixed Economy Individuals and the government share the

decision-making process Means of production are mostly privately

owned but government guides and regulates the economy.

Example: USA

ConsumersConsumers

The people who buy and use products

Goods/ServicesGoods/Services Goods are products

that you buy. Services are the

things people do for others in exchange for money or something of value.

Supply/DemandSupply/Demand

Amount of each good or service available to consumers

The amount of good or service that consumers are willing to buy.

CompetitionCompetition

Opportunity CostOpportunity Cost Value of the next best choice

vs.

ScarcityScarcity The condition that exists when wants exceed

resources available to satisfy wants

MonopolyMonopoly When specific individuals or enterprise has

sufficient control over a particular product or service that determines which other individuals should have access to it

Resources Human Resources

Natural Resources

Capital Resources(Tools, machines, and factories used to produce goods.)