Untitled Flashcards Set

capitalist economy -

individuals and buissness make desicons about production and dirstribution based on market forces like supply and demand with the primary goeal being profit. they have competion to keep it going. Additionally, the role of consumers is crucial as their preferences influence what goods and services are produced, leading to an ongoing cycle of innovation and efficiency within the market. focusing on maintiangcompetion and avoiding monopoluy especialy in small buisness.

HOW IT AFFECTS PEOPLE-

positive - povide economic growth and increased standard of living freedom of choice innovation and competion

negative - income inequality environment issues potential exploition of workers, and reduced job security in highly competitive markets. lack of engagement

command economy -

characterized by government ownership and central planning, where the government dictated what is produced how its produced and who recieves it, leading to a system where consumer preferences play a diminished role in economic outcomes. - no competition which causes lack of incentives (individuals or businesses are not motivated to improve their performance or innovate, often due to the absence of competition or rewards.)

HOW IT AFFECTS PEOPLE -

good can provide gaurenteed employment and prioratize social welfare

bad no entrepuernuership freedom abd individal economic freedom

limits comsusmer choice and can lead to a lack of innovation as companies may not feel the need to improve their products or services.

KEY DIFFERENCES

owenrship -

capitol- have private owner ship of the means of production - land labor capitol -

command - have gov onwership

desicipn making and price-

captitol - descions made by indiviudal and buisness based on market signlas - supply and demnd - prices are determinee by the interactions of supply and demand

command - gov makes all major economic decison, gov sets price