Chapter 2/Economic Systems

A. Concentration of production activities by individuals and companies in a limited number of activities

A. Concentration of production activities by individuals and companies in a limited number of activities

A. Concentration of production activities by individuals and companies in a limited number of activities

According to the definition, the central planned economy does not incorporate consumers' opinions into their needs and needs, all planned by the government.

A. A central political system characterized by a planned economy, where all the economic and political power comes to the hands of the central government.

B. Social and political philosophy with economic efficiency and economic growth and innovation as the main economic objectives

Authoritarian governments usually spend most of their budget to maintain large troops to ensure compliance at the expense of domestic programs that will help people.

B. Economic transition from central planned economy to market-based system

Why does the government need to meet some of the needs of society, such as education, medical care, public transportation?

B. Government's economic system that makes all decisions concerning the production and consumption of goods and services

2 1. Explain the basic economy, what is capitalism, and the mechanism of free market. 2. Analyze trends in the mixed economy. 3. Explain the importance of the US economic system, including key economic indicators (especially GDP), productivity, economic cycle and so on. 4. Compare fiscal policy and monetary policy and explain the impact each will have on the economy. Compare capitalism, socialism, communism, and mixed market. Learning objectives Chapter 2 2-2 What is economics? Economics - Study ways society uses resources to produce goods and services among various groups and individuals. Macroeconomics - Focus on the management of the national economy as a whole. Microeconomics - Focus on the behavior of people and organizations in specific products or service markets. Economic headquarters LG 1 2-4

Understanding economics and its impact on business Chapter 02 McGraw-Hill / Irwin Copyright © 2013 McGraw-Hill Companies, Inc. All rights reserved.

Therefore, capitalism is one of many historical variables the economic system can organize. As mentioned in Chapter 2, it is defined by three main conditions: production for the market; production materials are private, investment is privately managed In the labor market, work as a company employee It is. Thus, the definition of capitalism is different from the concept of "market economy". The thing is certain that capitalism is organized through the market, but not all market economies are capitalism. In the example above, the simple market economy has a market and privately owned, but the producer is a self-employed person, not an employee. It is not a private company, but a state-owned company can produce it for the market, this is not capitalism. Capitalism is different from all these "market economies"