IGCSE Economics CIE 2024 Revision Notes - 2.9 Market Economic System (PDF)

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These revision notes from SaveMyExams cover the free market system, part of IGCSE Economics, CIE syllabus. It defines the characteristics and explains the advantages and disadvantages of this economic model. The notes include examples of countries with varying degrees of government intervention.

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Start studying Search for a subject Log in Join now Revision Notes IGCSE Economics Cambridge (CIE) Revision Notes 2. The Allocation of Re...

Start studying Search for a subject Log in Join now Revision Notes IGCSE Economics Cambridge (CIE) Revision Notes 2. The Allocation of Resources 1. The Basic Economic Problem The (Free) Market System (Cambridge (CIE) 4 Topics · 5 Revision Notes IGCSE Economics) 2. The Allocation of Resources Revision Note 11 Topics · 16 Revision Notes Download Topic 1 2.1 Microeconomics &… Written by: Steve Vorster Topic 2 Reviewed by: Jenna Quinn 2.2 The Role of Markets in… Updated on 27 June 2024 Topic 3 2.3 Demand Definition and Characteristics Topic 4 A market economy is an economy that has no government intervention in the allocation of resources 2.4 Supply and distribution of goods/services This is also called a free market economy Topic 5 There is no purely free market economy in the world but some countries have less government 2.5 Price Determination intervention than others An economy can be considered to be a market, mixed or planned economy Topic 6 The type of economy is determined by how the three economic questions are answered (see: 2.6 Price Changes 2.2.1 The (Free) Market System). This ultimately determines the amount of government intervention in an economy Topic 7 2.7 Price Elasticity of… Topic 8 2.8 Price Elasticity of… Topic 9 2.9 Market Economic… The (Free) Market System Topic 10 2.10 Market Failure The spectrum of economic systems and where certain economies fall based on the degree of government intervention Topic 11 2.11 Mixed Economic… North Korea is a planned economy The United States, Japan and Singapore are mixed economies but have less government intervention 3. Microeconomic Decision… than Norway, Germany or China 8 Topics · 21 Revision Notes Characteristics of a Market System 4. Government & the… Characteristic Explanation 8 Topics · 21 Revision Notes Property Ownership Individuals have the right to purchase the factors of production 5. Economic Development 4 Topics · 7 Revision Notes Freedom of Choice Individuals are free to start their own business Firms are free to decide what they are going to produce, how, and for whom 6. International Trade &… Workers are free to decide who they are going to work for 4 Topics · 9 Revision Notes Consumers decided what goods/services best meet their wants/needs Self Interest Entrepreneurs maximise profits Workers maximise wages Consumers maximise their well-being/satisfaction Limited Government A pure market economy has no government intervention Intervention Most free market Download noteseconomies on The (Free)have a low Market level of intervention, usually in System the form of taxation, provision of defence, healthcare and education Price Mechanism Changes in prices allocate scarce resources Rising prices indicate a shortage of resources and falling prices indicate a surplus of resources Advantages and Disadvantages of a Market System Each economic system has numerous advantages and disadvantages The Advantages and Disadvantages of Market Economies Advantages Disadvantages Profit incentive motivates people to Wealth gets concentrated in the hands of the few as work or develop entrepreneurial ideas they are able to keep buying up the scarce factors of Greater variety of goods/services production Competition leads to better quality of This increases inequality such that the gap between goods/services the rich and the poor continues to grow Competition leads to lower prices of Sometimes product quality falls as firms lower goods/services quality standards in order to increase profits Competition encourages innovation Workers get exploited and product development Resource depletion and environmental degradation Profits, income and wealth are are often ignored unlimited resulting in better standards Monopolies develop as firms increase market power of living through mergers and acquisitions More efficient use of scarce resources This leads to exploitation of consumers and supply chains Examiner Tips and Tricks Multiple choice questions often explore your understanding of the different characteristics of market and mixed economic systems. When answering structured questions that ask you to discuss/explain the difference between two systems, ensure that the disadvantages of one system are not always just the opposite points to the advantages of the other system. Develop some unique points for each system. You've read 1 of your 5 free revision notes this week Sign up now. It’s free! Join the 100,000+ Students that ❤️ Save My Exams the (exam) results speak for themselves: I would just like to say a massive thank you This website is soooo useful and I can’t ever Incr for putting together such a brilliant, easy thank you enough for organising questions revi to use website. I really think using this by topic like this. Furthermore, the name of kno site helped me secure my top grades in the website could not have been more ac science and maths. You really did save my appropriate as it literally did SAVE MY a lo exams! Thank you. EXAMS! mo Beth Fathima Kate IGSCE Student A Level Student GCS Join now for free Test yourself Flashcards Did this page help you? Yes No Previous: Next: Calculation, Determinants & Significance of PES Market Failure Terminology More Exam Questions you might like Market Economic System Market Failure Mixed Economic System Money & Banking Households. Workers Trade Unions Firms Firms & Production Firms’ Costs, Revenue & Objectives More Flashcards you might like Market Economic System Market Failure Mixed Economic System Money & Banking Households. Workers Trade Unions Firms Firms & Production Firms’ Costs, Revenue & Objectives Author Reviewer Author: Steve Vorster Expertise: Economics & Business Subject Lead Steve has taught A Level, GCSE, IGCSE Business and Economics - as well as IBDP Economics and Business Management. He is an IBDP Examiner and IGCSE textbook author. His students regularly achieve 90-100% in their final exams. Steve has been the Assistant Head of Sixth Form for a school in Devon, and Head of Economics at the world's largest International school in Singapore. He loves to create resources which speed up student learning and are easily accessible by all. Resources Members Company Subjects Home Log in About us Biology Learning Hub Content Quality Chemistry Help and Support Jobs Physics Scholarship Terms Maths Join Privacy Geography Past Papers English Literature Solution Banks Psychology Sitemap All Subjects Missing a Subject or Exam Board? Tell us © Copyright 2015-2025 Save My Exams Ltd. All Rights Reserved. IBO was not involved in the production of, and does not endorse, the resources created by Save My Exams.

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