Economic Systems

Label 4 flaps on the front: Traditional Label 4 flaps on the front: Market Command Mixed

Traditional An economy in which economic decisions are based on the past. Jobs are hereditary (passed down through family) Use a barter system rather than currency

Market An economy in which economic decisions are made by the people (consumers and producers) Prices are based on supply and demand Currency (money) is used for buying and selling

Command economy An economic system in which economic decisions are made by the government The government sets prices The government controls what job you have and how much you are paid The government owns all resources and means of production (i.e. land, natural resources, businesses, factories, etc.)

Command Economy + Market Economy Mixed economy An economy that is a MIX of command and market Some decisions made by producers/consumers, some decisions made by the government Command Economy + Market Economy = Mixed Economy