Flashcards
Section 2 - learning objectives 9-12 resource allocation and types of economies
Flashcards do conjunto (16)
- 1resource allocationResource Allocation is the act of dividing up the scarce resources of the economy to produce different goods and services to meet the needs and wants of society.
- 2resource allocation decisions/questionsWhat to produce?
How to produce?
For whom to produce? - 3what to produce?Which products should be manufactured and in what quantities?”
- 4how to produce?This question focuses on the method of production influenced by:
• The costs of production
• The level of efficiency or productivity
• the level of mechanization - 5for whom to produce? (the distribution of goods)This question determine which consumers will have their needs and wants satisfied by the goods and services made by the economy
- 6economic systemstraditional (subsistence)
command or planned
Market (free market/ capitalist)
mixed economy - 7Traditional (subsistence economy)What to produce? - the people decide based on their needs
How to produce? - farming hunting gathering
For whom to produce? - make their own products and barter trade - 8Command (planned) economy
- 9market (free market) economy
- 10Mixed economy
- 11Advantages of command economyEven distribution of goods and services.
Provides sufficient public and merit goods
Low unemployment levels
stable economy - 12disadvantages of command economyNo incentives for innovation
Few individual choices for consumption
Inefficient distribution of goods and service. - 13advantages of (free) market economiesAn efficient allocation of scarce resources.
competition encourages innovation
Freedom of choice
Consumer sovereignty - 14disadvantages of (free) market economiesHighly unequal distribution of wealth
Public and merit goods under-provided
Demerit (harmful) goods over provided
No laws to regulate 'unfair or unethical' business activity - 15advantages of mixed economy- Public goods provided mainly by state and part by private enterprise..
- private enterprise motive of profit is encouraged within the boundaries of social welfare.
- efficiency in allocation of resources both private and public seek to provide g&s - 16disadvantages of mixed economy- The state-run enterprises are inefficient and will waste valuable resources whilst providing welfare for the general public
- taxation may seem as a disincentive for private firms especially if it is high
Informações
- Descrição
- resource allocation and types of economies
- Criado por
- Nikolas Reece
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