6.2.4 Economic Systems

• An economic system refers to the way a country organizes its economic activities and resources to meet the needs of its population
• In a market economy, prices, production, and the distribution of goods are determined by the market
• A free market system is characterized by minimal government intervention
• Private property is a key characteristic of a free market system.

  True
• In a command economy, the government owns the factors of production.


  True
• Command economies prioritize social and economic goals over market efficiency.

  True
• What is a key characteristic of a command economy regarding government control?

  Sets prices and production
• The government in a command economy allows the free market to determine economic outcomes

  False
• Match the characteristic of a command economy with its description:

  Government Control ↔️ The government sets prices and production levels

  Limited Individual Freedom ↔️ The government makes major economic decisions
• What does a mixed economy combine elements of?

  Command and market economies
• What public goods does the government provide in a mixed economy?

  Healthcare, education, and infrastructure
• A command economy relies on individual and business decisions based on supply and demand

  False
• In a free market system, prices, production, and distribution are determined by supply and demand.
• What does free enterprise in a free market system foster?

  Innovation and competition
• In command economies, equitable distribution often compromises economic efficiency

  True
• Match the economic system with its decision-making process:

  Command Economy ↔️ Central planning authority

  Market Economy ↔️ Based on supply and demand

  Mixed Economy ↔️ Combination of market forces and government regulation
• In a command economy, the government sets prices, production, and distribution
• Mixed economies attempt to balance economic efficiency with equity and control.


  True
• In a free market system, consumer sovereignty ensures goods and services meet consumer needs
• In a command economy, prices are set by the government
• In a command economy, the government decides what to produce, how much to produce, and how to distribute
• In a command economy, there is little individual economic freedom
• What are the factors of production in a command economy owned and controlled by?

  The government
• In a command economy, the government plans and directs all economic activity to achieve specific social and economic goals
• Government regulation in a mixed economy ensures fair competition and protects consumers


  True
• Mixed economies balance the benefits of both free markets and government intervention
• What is a key characteristic of a mixed economy regarding economic freedom?

  Significant economic freedom
• Private property in a free market system incentivizes investment and efficient use of assets


  True
• In a free market system, consumers dictate what is produced through their purchasing decisions
• What is one role of government regulation in a mixed economy?

  Ensure fair competition