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authoritarian socialism
This is also known as communism, and when
this occurs, the government owns or controls
nearly all the factors of production.
capitalism
In a mixed economy that is based on this,
individuals own the factors and answer the
basic economic questions.
command economy
This type of economy relies on government
officials to answer the three basic economic
questions.
communism
This is also known as authoritarian socialism, and
is said to be practice by mixed economies that are
closest to the pure command model.
competition
This is the economic rivalry that exists
among businesses selling the same or similar
products.
contracts
Individuals have the right to enter into agreements
with one another to buy and sell goods and
services- these agreements are called this.
democratic socialism
In this third and final type of mixed economy, it falls between
authoritarian socialism and capitalism. The government owns
some of the factors of production in this, but individuals are able to
influence economic planning through the election of government
officials.
free enterprise
This is a system under which business can be conducted freely with
little government intervention. The U.S. system of this also includes
such benefits for individuals as investment opportunities and prices
that respond to competition.
full employment
This is the lowest possible level of
unemployment in the economy.
incentive
This is something that encourages a
person to behave in a particular way.
income
The money paid to households by business
firms and the government in exchange for
the households' resources is called this.
market
The free exchange of goods and services is referred
to as this. This provides the only form of control
over what goods and services are bought and sold.
market economy
In this type of economy, individuals answer the three
basic economic questions. The government has no say
in what, how, and for whom goods are produced, and
the factors of production are owned by individuals.
mixed economy
This is an economy that combines elements of traditional, market,
and command economic models to answer the three basic
economic questions. The three main categories of this type of
economy are authoritarian socialism, capitalism, and democratic
socialism.
price stability
This is achieved when the overall price level of the goods and
services available in the economy is relatively constant. This also
refers to the prices of all products taken together- not to changes in
the price of an individual product.
product market
This is what represents all the exchanges of
goods and services in the economy.
resource market
This represents the exchange of resources between
households-individuals, business firms, and the
governments (the users of the resources).
self-interest
This is the impulse that encourages people to
fulfill their needs and wants.
standard of living
This refers to people's economic well-being. Economists
measure a nation's _______________ by how much
the average person in that country is able to consume in a
given period of time- usually one year.
traditional economy
This is an economy that is based on a society's valuesits customs and traditions. The people answer the the
three basic economic questions by looking in the past.