Chapter 2 - Allocation of resources

• Centrally planned economy

  The government guides resource allocation within a society
• Market economy

  Market forces are allowed to guide the allocation of resources within a society
• Specialisation

  The process of concentrating on a task or activity in order to become an expert in it
• Market

  A set of arrangements that allows transactions to take place
• Barter system

  An economy without money so that transactions in goods and services rely on direct exchange