Introduction
We use economic systems to produce and distribute goods and services. These systems are traditional, command, market, and mixed economies. Have you ever wondered how the coat you have in your closet was processed and distributed? Or how the vegetables at your local grocery were available to buy?
Task
In this lesson you will learn about economic systems and how they compare and differentiate and the different goals and purposes for each one. Then you will create a product by either drawing one or bringing a product in. You will answer the three economic questions and choose an economic system you would like to distribute your product under and explain how it is distributed.
Process
Part 1: Why do we need economic systems?
An economic system determines how resources will be used. The primary goal of an economic system is to provide people with minimum standard of living or quality of life.
Part 2: What are the three big questions?
Economic systems answer three big questions: what will be produced, how will it be produced, and who will get the output?
https://corporatefinanceinstitute.com/resources/economics/economic-system/
Reading the article above should give you an understanding of how each economic system answers these questions.
Evaluation
Complete the questions below.
What are three basic problems about economic systems?
Why does every country need an economic system?
In a market economy, who controls the factors of production?
In a command economy, who holds power over the economy?
If the government makes me produce a product, what economy is this?
Conclusion
"An economic system determines how resources will be used. The primary goal of an economic system is to provide people with minimum standard of living or quality of life."
What are the three big economic questions?
Today, you created or picked a product that you would like to distribute under one of the economic systems. Can you think of some possible economic obstacles that can affect the distribution of your product?
Credits
- Explain the three economic questions and how different economic systems answer these questions.
- Recognize that products sold to the masses must be distributed under an economic system.
- Identify a product that can be made and distributed in an economic system.