WRS - Economic Systems - Country Descriptions Directions: On the back of this sheet, there is a set of descriptions (descriptio
n 1 goes with number 1 on the other side). For each description, you must identify the economic system that is being described, then use textual evidence (actual words from the card) to explain how you know that is the economic system is described. Each will be used twice. Again, the economic system are:
Market Economy - Command Economy - Traditional Economy - Mixed Economy 1.
Economic System: _______________________ How do you know?:
2. Economic System: _______________________ How do you know?:
3. Economic System: _______________________ How do you know?:
4. Economic System: _______________________ How do you know?:
5. Economic System: _______________________ How do you know?:
6. Economic System: _______________________ How do you know?:
7. Economic System: _______________________ How do you know?:
8. Economic System: _______________________ How do you know?
1 State planners in Country A met to decide what the country should focus on producing. After much deliberation, they decided it would be in the country’s best interest to use their limited resources to produce automobiles instead of other consumer goods, such as electronics or textiles. The state planners passed their decision down to factories and allocated to them raw materials, workers, and other resources needed to produce automobiles. Factories were then told how much they should produce with these resources and who the final products should be shipped to.
2 In Country B, business owners decide what to produce, how much to produce, and who to produce for. The CEO of Tarheelia Audio, one of the leading audio equipment producers in the country, recently decided to increase production levels of the company’s newest MP3 player model, and at the same time decrease production levels of their most popular CD player. The reason for the emphasis on MP3 players is that demand for CD players has decreased dramatically as MP3 technology has taken over the market. Simply put, there is more profit to be made in the MP3 market.
3 In country C, people rarely engage in market transactions. For the most part, they do not need to. Families grow their own vegetables and raise their own animals or hunt to get meat. Certain times get tough for people in Country C, like when the winters are particularly cold or animals change their migration patterns. For this reason, it is important that families stock up in “good times” and develop relationships with neighbors with whom they can share or trade.
4 In country D, business owners make most economic decisions. As long as they abide by fair trade policies, they can decide what to produce and how to produce, and for whom to produce. The government does have to intervene at times when laws are broken or regulations are needed to keep income inequality lower. Certain services are provided by the government when there is no profit to be made on them. Consumers still drive the large majority of economic activity by what they purchase and demand in the society.
5 Positives: Individual roles are clearly defined, you know what you are doing and how to do it Negatives: Changes are slow, there’s little social mobility, and individuals don’t have control of environmental factors.
6 Within this economic system, it distributes wealth among all of society, focuses on equality, and can produce to fulfill needs. However, it can often lead to corruption among state planners, does not easily adjust to change, and can take away personal freedoms.
7 Within this economic system, prices are determined by the supply (amount) and demand (want), and competition brings down prices. There is little-to-no government intervention and there is a great variety of goods and services provided. However, this system may make it difficult for the government to provide necessary services, choices can be harmful, there’s inequality and poverty, and failures often create instability.
8 Within this economy, there is a focus on social needs (welfare), political freedom, and individual liberties and choices. There is still a variety of goods and services, but wealth is more evenly distributed, there is a focus on equality, and there is government intervention to provide stability. However, government intervention can stall or prevent growth, people still may make harmful choices, there are market failures, and the use of resources may not be for the best.
