2.  Economics is defined as the study of how goods and services are produced and distributed.  There are usually not enough essentials or luxuries to satisfy all the needs and wants of a whole society.  This leads to the economic principle of scarcity, by which decisions about production and distribution are based either on traditional factors, market forces, or government decree.

4.  An economic system in which decisions are made on the basis of customs, beliefs, religion, habit, and so on.  In traditional societies, scarce goods are often shared evenly, or else on the basis of age and gender.

5.  An economic system in which individual producers own and determine the production, distribution, and consumption of goods and services.  In market economies, products and services generally go to those who can afford to pay for them.

7.  An economic system in which the government owns and controls all facets of the economy.  Command economies usually satisfy the needs and wants of an elite class which controls the government and decision making.

8.  : An economic system that uses aspects of more than one of the three basic types of economic systems (subsistence, command, and market).

9.  what goods are produced?  how they are produced?  for whom they are produced?  by whom they are produced?  and how they are distributed?

11.  It is important to know that the majority of countries have some combination of the three economic systems outlined above.  The mixed economy usually blends free enterprise (the market economy) and government control (the command economy).  Canada is a good example of a mixed economy, with individual profit-seeking coupled with a government that taxes and spends for social services.

12.  Incentive of equality for all people  Public and private ownership of property  Private ownership = feeling of control, provides incentive  Public ownership = ideals of equality and economic strength is promoted (usually in areas of national importance, areas of high risk or to protect employment)  Joint ownership is often favored  Government controls and subsidies  Redistribution of wealth  social programs and progressive taxation, direct and indirect taxation (GST, airline fuel taxes)

13.  Paying the price for social programs  Difficult to raise taxes and lower social programs during economic upswing (hurts middle class)  Large bureaucracies