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AP Gov 2.1
Terms in this set (5)
What is an economic system?
An economic system is the method used by society to produce and distribute goods and services, depending on their goals and values.
Differences among traditional economy, market economy, command economy, and mixed economy.
Traditional economy: relies on habit, custom, or ritual to decide what to produce.
Market economy: economic decisions are made by individuals based on exchange and trade.
Command economy: central authority is in command of the economy.
Mixed economy: market-based economic system with limited government involvement.
Why aren't all people paid the same amount in factor payments for the resources they provide.
Factor parents come down to dependability. People who get payed the most are people who are depended on the most. Some resources are more important than others.
Why do governments provide safety nets?
Citizens want the security of knowing help is available if they face troubles. This allows people to build trust in their government.
Examples of a traditional, command, and market economic system.
Traditional: Mexican cities during Day of the Dead.
Command: North Korea's economy.
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