Economic Systems

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Economic Systems by Mind Map: Economic Systems

1. Traditional

1.1. relies on history, customs, and time-honored beliefs which includes production and distribution.

1.2. Advantages

1.2.1. Little to no friction between members

1.2.1.1. the comprehension of role and contribution

1.3. Examples

1.3.1. Latin America

1.3.1.1. Asia

1.3.1.1.1. the Middle East

1.4. Disadvantages

1.4.1. Isolation within the economy

1.4.1.1. Few choices offered

1.4.1.1.1. Lower quality of life

2. Command

2.1. an economy in which production, investment, prices, and incomes are determined centrally by a government

2.2. Advantages

2.2.1. Less Inequality

2.2.1.1. Low Unemployment Levels

2.2.1.1.1. Common Good vs Priority Profit

2.3. Disadvantages

2.3.1. Lack of Competition = low innovation

2.3.1.1. Inefficency

2.4. Examples:

2.4.1. Cuba

2.4.1.1. North Korea

2.4.1.1.1. Soviet Untion

3. Market

3.1. An economic system in which production and prices are determined by unrestricted competition between privately owned businesses

3.2. Advantages

3.2.1. Sufficient amount of products

3.2.1.1. motivation from merchandisers

3.2.1.1.1. less shortage and surplus of products

3.3. Disadvantages

3.3.1. inferior products

3.3.1.1. non beneficial for workers and the enviornment

3.3.1.1.1. skyrocketing of prices of commodity

4. Mixed

4.1. an economic system combining private and public enterprise

4.2. Advantages

4.2.1. freedom to hire, fire, buy, and sell in businesses

4.2.1.1. various restrictions

4.2.1.1.1. ensure that the standard of living is a whole

4.3. Disadvantages

4.3.1. government control

4.3.1.1. associated with social democratic parties run by social democratic governments

4.3.1.1.1. Similar to capitalism

4.4. Examples of a Mixed Economy

4.4.1. United States

4.4.1.1. Russia

4.4.1.1.1. China

5. What economy do we live in?

5.1. The United States lives in a Mixed Economy where we are also called the "Land of Opportunity"

6. Why is it important to have an economic system?

6.1. Economic systems keep the government regulated and some are controlled by the people. It also helps with organization and keeping track of certain things. However, the United States has a mixed economy which allows us to be more efficient and we have better benefits than some countries like, communist countries.