3 Questions
In a Market Economy, how are the 3 economic questions decided?
By individuals in the market place
Which economic system has the government as the main decision maker for the 3 economic questions?
Command Economies
What characteristic defines Mixed Economies in terms of decision making for the 3 economic questions?
By a combination of market decision making and government order
Study Notes
Economic Systems and Decision Making
- In a Market Economy, the 3 economic questions (what to produce, how to produce, and for whom to produce) are decided by individuals and businesses, driven by market forces of supply and demand.
Command Economy
- In a Command Economy, the government is the main decision maker for the 3 economic questions, with the goal of achieving social welfare and equality.
Mixed Economy
- A Mixed Economy is characterized by a combination of government intervention and private enterprise in decision making for the 3 economic questions, balancing individual freedom and social welfare.
Test your knowledge on various government systems like democracy, communism, oligarchy, and monarchy, as well as economic systems such as traditional economy, market economy, command economy, and mixed economy. Explore the concepts of resource allocation, production methods, and distribution of goods and services.
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