1. TYPES OF ECONOMIES

4. WHAT EVERY ECONOMIC SYSTEM MUST ADDRESS?
1. WHAT to produce?
2. HOW to produce it?
Which resource combinations to use?
How to distribute it among the system’s members?
3. FOR WHOM to produce?

5. SCARCE RESOURCES vs. UNLIMITED WANTS

6. ASPECTS OF EFFICIENCY
(efficiency = the quality of doing something well and without wasting time, money, or energy)
distribution of resources
choice
cost
quality
stability
growth
long-term interests

8. TYPES OF ECONOMIES 1. COMMAND OR PLANNED ECONOMY 2. MIXED ECONOMY
3. FREE MARKET ECONOMY

10. PLANNED ECONOMY resources belong to the state (planned by the state)
role of government vital ( plans and
organises the whole production)
production for need rather than profit
standardised goods, little choice
more equal distribution of wealth and
income
workers less motivated but - safe jobs

12. MIXED ECONOMY resources allocated by government
(the public sector) and by the market forces of
demand and supply (the private sector)
role of government depends on the level of
development, provides a minimum standard of
living, ensures fair competition / a level
playing field
production of public goods paid by taxes,
all private sector production for profit

14. FREE MARKET ECONOMY resources allocated automatically
market mechanism (demand & supply)
role of government limited (pass laws, essential products and services like policing, national defence, the judiciary)
unequal distribution of income
production only for profit
planning and organising carried out by
firms

15. Disadvantage: a huge rift between the wealthy and the poor

17. 1. RB: p 29: FILL IN THE GAPS IN THE TEXT

18. 2. RB: p 17: a) ADVANTAGES OF FREE MARKET ECONOMIES:
____________________________________
B) DISADVANTAGES OF FREE MARKET ECONOMIES:
_____________________________________
C) ADVANTAGES OF PLANNED ECONOMIES
______________________________________
D) DISADVANTAGES OF PLANNED ECONOMIES

19. RB: p: 29 INSERT THE MISSING WORDS:
Some theorists were for less government _________________ and more reliance on the ________________ . The basic government role is in _____________________ unemployment. As communism _______________, many countries turned towards _______________ economies. State _____________ were sold to private _______________ . The central planners lost their control over __________. ___________ and ______________ were no longer guaranteed by the state.

20. 3. FIND OUT THE DIFFERENCES BETWEEN THE TWO TYPES OF ECONOMIES:
Market economy Planned economy
________________________ _______________________
________________________ _______________________

21. 4. FILL IN THE MISSING WORDS BELOW:
laws, limited, quality, demand, goods, supply, motivated, services, allocated,
standard, prices, competition, vital, range, needs
In market economies resources are ________________
automatically by the forces of __________________and _____________________. Competition leads to lower _______________, a wider ______________________of goods, goods and services are better ____________.The role of government is _____________: to pass ________, to provide certain ___________and ______________and ensure fair ______________ In planned economies government has a ______________role. Production is for ________________rather than for profit, people are less _______________to work efficiently and the _________
of living is lower.

22. 5. Explain the following words: 1. Traditional economy =
Explain the following words:
1. Traditional economy =
2. Manorialism =
3. Mercantilism =
4. Laissez faire capitalism =
6. Command economy =