systems for producing, distributing and consuming goods and services

Economic Systems Vocabulary Review

Economic Systems

Economic Systems

systems for producing, distributing and consuming goods and services

Traditional Bartering

Traditional Bartering

where goods and services are directly exchanged for other goods or

services (no currency (money) is involved)

Command Economy

Command Economy

An economy where supply and price are regulated by the government

rather than market forces. Government planners decide which

goods and services are produced and how they are distributed

Market Economy

Market Economy

A system of allocating resources based only on the interaction of

market forces, such as supply and demand. A true market economy is

free of governmental influence

Mixed Economy

Mixed Economy

in which the government imposes boundaries on capitalism to limit the concentration of power and achieve social balance. The U.S. economic

system is a mixed economy

Capitalism

Capitalism

individuals and companies are allowed to compete for their own economic gain; and free market forces determine the prices of

goods and services. Such a system is based on the premise of separating the state and business activities. Capitalists believe that markets are efficient and

should thus function without interference, and the role of the government is to

regulate and protect

Communism

Communism

economic system characterized by the collective ownership of property and by the organization of labor for the common advantage of all members, state plans and controls the economy and a single, often authoritarian party holds power. (all goods are equally shared by the people, derived from Karl Marx)

Socialism

Socialism

Economic system which is based social organization rather than

competition and advocates centralized planning, distribution, and exchange should be regulated

by the community as a whole.

Globalization

Globalization

Name for the process of increasing the connectivity and interdependence of the world's markets and businesses

(growth to a global or worldwide scale)

Interdependence

Interdependence

A relationship between two or more people, regions, nations or other entities (things) in which each is

dependent on the other for necessary goods or services

Natural Resources

Natural Resources

-Resources occurring in nature that can be used to create wealth.

Examples include oil, coal, water, land, minerals, forests, water.

Raw Materials

Raw Materials

A material or substance used in the primary production or manufacturing

of a good. Raw materials are often natural resources.

Renewable /Non Renewable Resource

Renewable /Non Renewable Resource

A natural resource that can replenish itself over time is renewable (Water,

wind power, solar power). Nonrenewable cannot be replenished

(oil).

Personal Finance

Personal Finance

All financial decisions and activities of an individual, this could include budgeting, insurance, savings, investing, debt servicing (credit

cards), and mortgages.