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Ideally, economic systems seek to reassure people that goods and services will be available when needed and they can count on receiving expected payments on time. Chapter 2: Economic Systems Section 4. Chapter 2 economic systems worksheet answer key. Slide 11 Copyright © Pearson Education, apter 2 Section 1 Economic Efficiency Because resources are always scare, societies try to maximize what they can produce using the resources they have. How should goods and services be produced? Competition encourages innovation, which causes economic growth. According to Smith, consumers will respond to the positive incentive of lower prices by buying more goods because spending less money on a good lowers the opportunity cost of the purchase.
Click to see the original works with their full license. Slide 30 Copyright © Pearson Education, apter 2 Section 1 Competition –Firms seek to make higher profits by increasing sales. Slide 39 Copyright © Pearson Education, apter 2 Section 1 Command v. Free Market Command economies operate in direct contrast to free market systems. 18. worries a lot 12 3 Assumes the best about people 5 5 is fascinated by art music. In the United States, Americans face some limitations but, in general, we enjoy a large amount of economic freedom. Each choice comes with some kind of trade-off. Economic systems also strive to achieve a certain degree of economic security. Communism derived from the writings of Karl Marx who believed that labor was the source of all value but that under capitalism, all the profit created by laborers ended up in the hands of the property owners. Command economies oppose: –Private property –Free market pricing –Competition –Consumer choice. Specialization leads to efficient use of land, labor, and capital. Slide 2 Copyright © Pearson Education, apter 2 Section 1 Objectives entify the three key economic questions that all societies must answer. Economic systems chart answer key. Slide 55 Copyright © Pearson Education, apter 2 Section 1 Hong Kong Hong Kong represents one of the world's freest markets.
Explain the rise of mixed economic systems. The government: Provides national defense and public education Protects private property Ensures fair exchanges in the marketplace. Recommended textbook solutions. Slide 19 Copyright © Pearson Education, apter 2 Section 1 Key Terms market: any arrangement that allows buyers and sellers to exchange things specialization: the concentration of the productive efforts of individuals and businesses on a limited number of activities free market economy: an economic system in which decisions on the three key economic questions are based on the voluntary exchange in markets household: a person or group living in a single residence. The figure below shows a continuum of mixed economics in today's world. Analyze a circular flow model of a free market economy. In a mixed economy, the market is free but has a certain degree of government control. Terpret a circular flow model of a mixed economy. Traditional economies are usually found in communities that tend to stay small and close. Entify the advantages of a free market economy. The characteristics of a traditional economy. Economic systems quizlet answers. Smith called this self-regulating mechanism of the market "the invisible hand. " Some images used in this set are licensed under the Creative Commons through. Because of specialization, markets are needed to give people an arena with which to sell their products and to buy products that they don't produce themselves but need.
Traditional economies rely on habit, custom, or ritual and revolve around the family. Markets, like a farmer's market, a sporting goods store, and the New York Stock Exchange, eliminate the need for any one person to be self-sufficient. A nation's economy must grow so it can provide jobs for the new people joining the workforce. Slide 40 Copyright © Pearson Education, apter 2 Section 1 Examples of Centrally Controlled Economies Socialism The term socialism describes a range of economic and political systems based on the belief that wealth should be evenly distributed throughout society (economic equity) Socialists argue that economic equity can only exist if the centers of economic power are controlled by the government or by the public as a whole, rather than by individuals or corporations. Slide 25 Copyright © Pearson Education, apter 2 Section 1 Free Market Economy In a free market, answers to the three key economic questions are made by voluntary exchange in the marketplace. Despite the advantages of a free market economy, no country today operates under a pure, unregulated free market.
Mpare the mixed economies of various nations along a continuum between centrally planned and free market systems. Students also viewed. Use your answer to explain why thermonuclear weapons require regular maintenance. This decision had a harsh effect on factories that made consumer goods. The government owns all the property and output equipment. Explain why markets exist. Economic transition: a period of change in which a nation moves from one economic system to another privatization: the process of selling businesses or services operated by the government to individual investors, and then allowing them to compete in the marketplace free enterprise system: an economic system in which investments in firms are made in a free market by private decision rather than by state control. Slide 41 Copyright © Pearson Education, apter 2 Section 1 Communism –Under communism, the central government owns and controls all resources and means of production. Slide 9 Copyright © Pearson Education, apter 2 Section 1 Question 3 Who consumes goods and services? Firm: an organization that uses resources to produce a product or service, which it then sells factor market: the arena of exchange in which firms purchase the factors of production from households product market: the arena of exchange in which households purchase goods and services from firms self-interest: an individual's own personal gain. Relationship between quantity supplied, quantity demanded and. Why is China a little bit farther to the right on the diagram below than Cuba? Consumers pursuing their self-interest have the incentive to look for lower prices. They have a large degree of economic freedom.
Slide 3 Copyright © Pearson Education, apter 2 Section 1 Key Terms economic system: the structure of methods and principles that a society uses to produce and distribute goods and services factor payment: the income people receive in return for supplying factors of production profit: the amount of money a business receives in excess of expenses safety net: a set of government programs that protect people who face unfavorable economic conditions. Slide 31 Copyright © Pearson Education, apter 2 Section 1 Advantages of a Free Market Under ideal conditions, free market economies meet the following economic goals: –They respond to rapidly changing conditions. Analyze the use of central planning in the Soviet Union and China. Tritium is a radioactive form of hydrogen (containing proton and neutrons) with a half-life of about years. Slide 57 Copyright © Pearson Education, apter 2 Section 1 Government Intervention The American government intervenes in the economy by: –Keeping order –Providing vital services –Promoting general welfare Federal and state laws protect private property. Slide 13 Copyright © Pearson Education, apter 2 Section 1 Economic Equity Economic equity is another economic goal that is defined differently in different societies. Slide 14 Copyright © Pearson Education, apter 2 Section 1 Economic Growth A society also strives for economic growth. Markets allow us to exchange the things we have for the things we want.
Upload your study docs or become a. Self-Interest and Competition are absent However, command economies do guarantee jobs and income and can be used to jump-start selected industries. The government protects private property and rarely interferes in the free market, aside from establishing wage and price controls on rent and some public services. If a child suffers from congenital analgesia, why must he or she be careful when outside playing? The government also controls where people work and what they are paid. This question is largely determined by how societies distribute income. Through factor payments, including profits, societies can determine who will be the consumers of the goods and services produced. Who consumes these goods and services? Other sets by this creator. Slide 35 Copyright © Pearson Education, apter 2 Section 1 Objectives scribe how a centrally planned economy is organized.
D. The child's sense of smell does not work properly. Slide 23 Copyright © Pearson Education, apter 2 Section 1 The Purpose of Markets Checkpoint: Why do markets exist? Scribe the self-regulating nature of the marketplace. Slide 38 Copyright © Pearson Education, apter 2 Section 1 How Central Planning Works –In a centrally planned economy (also known as a command economy), the government, rather than individual producers and consumers, answer the key economic questions. Economic Equity: The situation in an economy in which the apportionment of resources or goods among the people is considered fair. It is characterized as a free enterprise system.
Amutationofaglutamicacidresiduetoalysineinanenzymeinthecellwillmostlikelydisrupt. There is little room for innovation or change. Distinguish between socialism and communism. A mixed economy is characterized by: A market-based economy with some government intervention Government helps societies meet needs that would be too difficult for them to meet under a totally free market economy, such as education Government protects property rights and ensures that exchanges in the marketplace are fair. Slide 24 Copyright © Pearson Education, apter 2 Section 1 Specialization Rather than being self-sufficient, each of us specializes in a few products or services. How a society answers these three questions defines the type of economic system that society has. In a free market system, individuals and privately owned businesses own the factors of production. The marketplace operates with a limited degree of government regulation. Slide 5 Copyright © Pearson Education, apter 2 Section 1 Introduction What goals and values affect how a society answers the key economic questions? Scope 3 Waste to Landfill Greenhouse Gas Emissions Australia operations Scope 3. Entify the disadvantages of a centrally planned economy. Slide 15 Copyright © Pearson Education, apter 2 Section 1 Traditional Economies The oldest and simplest economic system is known as a traditional economy. Slide 47 Copyright © Pearson Education, apter 2 Section 1 Key Terms laissez faire: the doctrine that government generally should not intervene in the marketplace private property: property that is owned by individuals or companies, not by the government or people as a whole mixed economy: a market-based economic system in which the government is involved to some extent.