Economic Systems

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Economic Systems by Mind Map: Economic Systems

1. Market Economy

1.1. Corporations and people are encouraged to own property

1.2. The Profit belongs to the owners of the business, and they can choose how to spend their rewards.

1.3. Competition encourages companies to provide quality products at a reasonable price so that consumers do not switch to other brands.

2. Mixed Economy

2.1. Property owned by individuals, corporations, or government

2.2. profit is encouraged, but is taxed to support government projects and programs

2.3. strong competition amongst corporations and government.

3. Centrally Planned Economy

3.1. ownership of property is restricted

3.2. All profit belongs to government, and citizens do not receive a portion of the profits they help to make.

3.3. competition is limited, government determined the price, quality, style amount of goods and service

4. Classifications of Economic Developement

4.1. Underdeveloped countries: is known as the least developed or the third world, are nations that are at the lowest level of the world's economies.

4.2. Developing countries: known as emerging countries, are characterized by improved literacy rates, increased access to healthcare and technological advancement.

5. Political Systems

5.1. Democracy: democracy is characterized by free and fair elections, rule of law, free speech, the right to assembly, a free press and freedom of religion

5.2. Autocracy: ruled by a single individual or a small group of people.

6. Business Cycle

6.1. Recession: 2 consecutive quarters of negative GDP. In this phase the economy slows down.

6.2. Through: production and employment reach their lowest levels.

6.3. Expansion: at this stage the economy begins to grow again. Employment, wages, production and profits all expand.

6.4. Peak: The economy stops expanding and begins contracting.