Economic Markets and Systems

When you hear the work “Market”, what do you think of?

Perhaps something like this.

For example, there is a market for music. In economics, markets are systems in which things can be bought or sold. For example, there is a market for music. There are buyers who want to own music and there are sellers (bands and record labels) who own the music. The music market is the system in which buyers gain ownership of music. This could be in a store, at a concert, online, or in a studio.

In different countries, the government has different amounts of control over markets.

Communism- An economic system in which everything is owned by the government. It is the government’s responsibility to produce goods and distribute those goods evenly amongst the citizens. Capitalism- An economic system in which everything is owned by individuals. The government has no control over the economy. All decisions are determined by individuals.

The Three Basic Economic Questions What should be produced? How should it be produced? For who will it be produced? (Who will consume it)

Market determines--if it will sell, it will be made Question Capitalism Communism What to produce? Market determines--if it will sell, it will be made The Government decides what to produce depending on what they see as a need of all the people Who produces it? Market determines--if an entrepreneur decides to make the product to make a profit, the entrepreneur will produce it The government decides which government owned factories produce the goods they decide to make For who is it produced? Market determines--if the consumer can afford it, the entrepreneur will produce it for the consumer Government councils decide which citizens get which goods

Advantages Disadvantages Communism Capitalism