...describe the 3 economic systems that govern economies around the world. 3 Economic Systems There are three types of economic systems that govern economies around the world. These are Traditional Economy, Market Economy and Command Economy. 1. Traditional Economy: This economy system is based on traditions. Economic decisions are based on customs, beliefs and traditions of the community, family, clan or tribe. At one time most people lived in traditional economies. In modern times this system still exists in rural and non-developed countries. Under this system, economic decisions are based on customs, religion and culture.. An Individual’s roles and choices are based on customs of past generations. This economic system often uses bartering and trading of goods although this may be limited because there is very little surplus produced. A disadvantage of this system is that it tends to discourage modern technology and the lack of progress tends to lower the standard of living. As a result modern technology is not prevalent in this type of economic systems The supporters of this type of economy believe that this system offers the advantage of stability and preserves the spiritual and cultural aspects of life. To summarize individuals in this system base their decision on past customs as opposed to having the freedom in making economic choices 2. Market Economy: This system of economy is based on supply and demand. It represents a free market system where persons...
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...Economic planning is a mechanism for economic coordination contrasted with the market mechanism. There are various types of planning procedures and ways of conducting economic planning. As a coordinating mechanism for socialism and an alternative to the market, planning is defined as a direct allocation of resources and is contrasted with the indirect allocation of the market. The level of centralization in decision-making in planning depends on the specific type of planning mechanism employed. As such, one can distinguish between centralized planning and decentralized planning. An economy primarily based on central planning is referred to as a planned economy. In a centrally planned economy the allocation of resources is determined by a comprehensive plan of production which specifies output requirements. Planning may also take the form of directive planning or indicative planning. A distinction can be made between physical planning (as in pure socialism) and financial planning (as practiced by governments and private firms in capitalism). Physical planning involves economic planning and coordination conducted in terms of disaggregated physical units; whereas financial planning involves plans formulated in terms of financial units. Different forms of economic planning have been featured in various models of socialism. These range from decentralized-planning systems, which are based on collective-decision making and disaggregated information, to centralized systems of planning...
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...Intro to Economic Concepts Definition of Scarcity A situation in which human wants are greater than the capacity of available resources to provide those wants. 3 Parts: 1. People want it 2. There is a limited amount of it 3. It has more than one productive use Scarcity Scarcity vs. Abundance – people see many signs of abundance (e.g. cell phones, iPods) and also see resources wasted daily (e.g. water and food). However, as long as resources are limited and people’s wants are unlimited, scarcity (in the economic sense) will exist. Scarcity In economic reasoning, scarcity is a relative concept, not an absolute one. Scarcity does not mean “not plentiful.” In economics, something is scarce when it has more than one valuable use. = & Opportunity Cost Opportunity cost is what you give up to obtain something else, the second-best alternative. However, what you must give up is not money – it is whatever good or service you would have spent the money on as your next favorite choice. Goods v. Services Good – something that is tangible; it can be seen and felt. It requires scarce resources to produce and it satisfies human wants Goods v. Services Service – something that is intangible; yet it too requires scarce resources to produce and satisfies human wants Is it a good or service? Productive Resources L – land (and stuff from land) L – labor (physical and mental) C – capital (human-made...
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...Lindolfo Lazareth Mireles III AP Macroeconomics – 1B Mr. W. English 2 September 2013 Traditional Economy VS Command Economy In economics we study how individuals and society seek to satisfy needs and wants through incentives, choices, and allocation of scarce resources. We know that we cannot have everything, we have to make choices. We then asked ourselves, “How will society choose between what they do and don’t have?” that’s why economic systems were created. They were created specifically to answer the three economic questions. What should we produce? How should we produce it? And Who should get it? There’s different ways we can answer these questions, it all depends on the economies goals and values. The first type of economy I will be discussing is Traditional economy. This type of economy is found in rural, underdeveloped countries such as Vanuatu, Pygmies of Congo, Eskimos, Indian tribes and Belarus. Which are all very small groups. In this kind of economy customs govern the economic decisions that are made, so they do things based on the ways they’ve always done them. The advantages of this economic system are that people have very specific roles, they have a sense of security in the way things are done. Men and women usually have very defined roles, usually very gender specific. There’s no question on what you’re going to do or how you’re going to do it, you will do it the way that they’ve always been done. The disadvantages are that there is absolutely no technology...
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...Question 1.1. (TCO 1) Economics is the study of (Points : 1) increasing the level of productive resources so there is maximum output in society. increasing the level of productive resources so there is a minimum level of income. how people, institutions, and society make choices under conditions of scarcity. the efficient use of scarce resources paid for at the minimum level of cost to consumers and businesses. Question 2.2. (TCO 1) The basic economic problem is essentially one of deciding how to make the best use of (Points : 1) limited resources to satisfy limited economic wants. limited resources to satisfy unlimited economic wants. unlimited resources to satisfy unlimited economic wants. unlimited resources to satisfy limited economic wants. Question 3.3. (TCO 1) From an economic perspective, when a student decides to attend another year of college, the student has concluded that the marginal (Points : 1) costs of attending college has decreased that year. benefits of attending college has increased that year. benefits of attending college are greater than the marginal costs. costs of attending college will be subsidized by someone else such as parents or the government. 4. (TCO 1) The individual who brings together economic resources and assumes the risk in a capitalist economy is called the (Points : 1) manager. entrepreneur. ...
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...Question 1.1. (TCO 1) Economics is the study of (Points : 1) increasing the level of productive resources so there is maximum output in society. increasing the level of productive resources so there is a minimum level of income. how people, institutions, and society make choices under conditions of scarcity. the efficient use of scarce resources paid for at the minimum level of cost to consumers and businesses. Question 2.2. (TCO 1) The basic economic problem is essentially one of deciding how to make the best use of (Points : 1) limited resources to satisfy limited economic wants. limited resources to satisfy unlimited economic wants. unlimited resources to satisfy unlimited economic wants. unlimited resources to satisfy limited economic wants. Question 3.3. (TCO 1) From an economic perspective, when a student decides to attend another year of college, the student has concluded that the marginal (Points : 1) costs of attending college has decreased that year. benefits of attending college has increased that year. benefits of attending college are greater than the marginal costs. costs of attending college will be subsidized by someone else such as parents or the government. 4. (TCO 1) The individual who brings together economic resources and assumes the risk in a capitalist economy is called the (Points : 1) manager. entrepreneur. ...
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...Types of economic systems Economics studies how society chooses to use resources to produce and distribute goods and services for people’s consumption. To use its limited resources effectively, every nation needs an economic system. The primary goal of an economic system is to provide people with a minimum standard of living, or quality of life. There are four types of economic. They are free market economy, command economy, mix economy and traditional economy. Free market economy In a market economy economic decisions are made in the marketplace according to the laws of supply and demand. Price is the amount of money given or asked for when goods and services are bought or sold. Demand is the amount or quantity of goods and services that consumers are willing to buy at various prices. The higher the price, the fewer consumers will buy an item. The lower the price, the more consumers will buy an item. Supply is the amount of goods and services that producers will provide at various prices. Demand and supply work together. When the quantity demanded and the quantity supplied meet, the price is called the equilibrium price. A market economy is also called capitalism, or private enterprise. In a capitalist system, resources are privately owned. In a capitalist system, the primary role of government is to support the marketplace by removing obstacles such as trade barriers. A market economy offers incentives, such as competition and the profit motive, to produce more. The constant...
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...How People Make Economic Decisions Paper How people make economic decisions regarding their buying’s of good or services at the market are ruled by three basic principles as follows: People are rational as they make the best decision that will benefit each individual on their purchases or selling’s. The people evaluate constantly the benefits versus the cost of the goods or services. Example of this might be: An imaginary famous nail enamel branch was priced originally as .39 cents as the sale manager established. The famous branch was heading to bankrupt then did a marketing study of the market where they establish that the price the people where most likely to pay was .69 cents; this show us that the people associates price with quality. People respond to economic incentives, The basic idea behind the incentive tells that people tend to move towards a decision that they didn’t considered before if at the time they will receive any monetary incentive for it. As an example the author show us how Estonia woman start having babies after the government decide to provide incentive for each child birth to the mother for a couple of months with the goal of rise the born and death rate in this country that still critical. Finally the Optima decision is made at the margin where the benefits are maximize, where the seller obtain the maximum return possible for what the buyers are willing to pay for a good or service. The best example to show the application of the marginal benefits...
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...Content Table: Induction………………………………………………………………………………….3 Types of organizations, missions and goals…………….…………………………...3 Economic system and impact of organizations………………………………………5 Stakeholder……………………………………………...……………………………….6 Stakeholder influence of organization………………………….…………………...…8 Fiscal policy…..…………………………………………………………………………..8 Monetary policy…………..………………………………………………………………9 Competition policy and Regulatory Mechanism …………………………………….10 Market Structure ………………………………………………………………………..11 PESTLE………………………………………………………………………………….14 EU………………………………………………………………………………………...14 Summary……………………………….………………………………………………..15 Task 1.1 Introduction Morrison Supermarket is the UK’s fourth largest supermarket. It is part of the FTSE 100 index and headquartered at the West Yorkshire (Bradford) in England. Morrison Supermarket is the smallest partner in the chain of four supermarkets (Big Four) due to its small market share. Other members of the “Big Four” are Sainsbury’s, Asda and Tesco. Currently, Morrison Company has a total of 455 superstores, including those purchased from Safeway plc. Most of the stores operate from the large superstores and primarily deal with home wares and groceries as well as furnishings, clothing and electronic items. Morrison Supermarket has lately resorted to online shopping as a result of purchasing a stake 10% of the UK online grocer, Fresh Direct. Task 1.2 Types of organizations , purpose , mission and goals The general notion states that...
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...IGBESA, OGUN STATE PGD ACCOUNTING ECONOMIC EVALUATION OF INVESTMENT “A SYSTEM FOR BUILDING CONSTRUCTION PROJECTS IN THE CONCEPTUAL PHASE” BY ADENUGA OLUFEMI SOLOMON MATRIC NO: PG14/05/005 JUNE 2015 ECONOMIC EVALUATION OF INVESTMEST “A SYSTEM FOR BUILDING CONSTRUCTION PROJECTS IN THE CONCEPUTAL PHASE” ABSTRACT The conceptual phase of capital projects is of strategic importance – an economic evaluation at this early stage is critical to the owners’ decision-making with limited information. The current study developed a comprehensive but practical system that can be used in such an early phase for economic evaluation of capital building construction projects. The system integrates four analytical steps: (i) Project planning, (ii) Construction costs estimation, (iii) Projection of incomes and expenditures and; (iv) Economic evaluation. Due to the integration, the system effectively manages the information flow from the planning to the evaluation, in which any changes from the initial plan are fully accounted for multiple alternates. In the system, users predict construction cost using a combined estimating method with historical project data and assembly costs. The system performs the tabulation of all incomes and expenditures based on the automated calculation as well as users’ inputs and then the economic evaluation based on project cash flow, which is generated using an automated scheduling method. System performance has been tested in terms of its...
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...these four types of economic systems. Give an example of a country that illustrates each type of system. Market capitalism is an economic system in which the price and productions of goods and services are determined by their availability and consumer demand rather than by government or state regulation. An example of market capitalism would be the United States’ mixed market economy from which goods are produced, bought, and sold with prices and production being determined by consumer demand with limited interference from government regulation. Centrally planned socialism differs from market capitalism in that the government or state determines what goods and services will be produced and consumers demand is not a significant focus. China would be an example of a country that uses this type of economic system, the states decide which goods consumers’ need and that is what is produced. Centrally planned capitalism is similar to centrally planned socialism in that the government or state determines what goods are to be produced, but allows private companies to produce them. Sweden is an example of centrally planned capitalism due to two-thirds of businesses being owned by the government, the remaining companies produce what is perceived to be needed. Market socialism differs from the other economic systems in that it is complete and self-regulating; production is communally owned and operated with profits being divided among workers. Vietnam used this system for a brief...
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...Chapter 1 Introduction to Business & Economics Lecture Notes A. LEARNING OBJECTIVES After studying this chapter, students should be able to: 1. Discuss what you must do to be successful in the world of business. 2. Define business and identify potential risks and rewards. 3. Define economics and describe the two types of economic systems: capitalism and command economy. 4. Identify the ways to measure economic performance. 5. Examine the four different phases in the typical business cycle. 6. Outline the four types of competition. B. BRIEF CHAPTER OUTLINE I. Business: A Definition A. The Organized Effort of Individuals B. Satisfying Needs C. Business Profit II. Types of Economic Systems A. Capitalism B. Capitalism in the United States 1. Households 2. Businesses 3. Governments C. Command Economies 1. Socialism 2. Communism III. Measuring Economic Performance A. The Importance of Productivity in the Global Marketplace B. Important Economic Indicators that Measure a Nation’s Economy IV. The Business Cycle V. Types of Competition A. Perfect Competition 1. The Basics of Supply and Demand 2. The Equilibrium, or Market, Price B. Monopolistic Competition C. Oligopoly D. Monopoly C. COMPREHENSIVE LECTURE OUTLINE I. BUSINESS: A DEFINITION Business is the organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy...
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...out-of-print volume from the National Bureau of Economic Research Volume Title: Input-Output Analysis: An Appraisal Volume Author/Editor: Volume Publisher: Princeton University Press Volume ISBN: 0-870-14173-2 Volume URL: http://www.nber.org/books/unkn55-2 Publication Date: 1955 Chapter Title: Interindustry Economics and National Income Theory Chapter Author: Herman Liebling Chapter URL: http://www.nber.org/chapters/c2870 Chapter pages in book: (p. 291 - 320) Interindustry Economics and National Income Theory HERMAN I. LIEBLING DIVISION OF INTERINDUSTEY ECONOMICS, BUREAU OF LABOR STATISTICS A. Frameworks of Comparison Within the limits of the broad concepts underlying interindustry and national income accounting, the substance of this paper deals with, first, criteria of social accounting and, second, differences in analytic approach required by the specialized structure of differently composed social accounting systems. A pattern of interindustry flows of goods and services may, of course, be developed independently of considerations of social accounting or of measures of output for the economy—the two objectives of the national income system. This paper, however, seeks to evaluate the two systems of accounts, in the light of the considerations noted above, in terms of (1) similarities and differences between types of activities and transactions included, (2) the relationship of the respective sector accounts, and (3) the types of analysis for which each is comparatively...
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...business. External factor are those factors which are beyond the control of business enterprise. These external factors are government factors, legal factors, physical factors and demographical factors. External environment or factors are also two types, micro environment and macro environment. Micro environment consist of suppliers, customers, market intermediaries, competitors and public. Micro environment is also known as operating environment. Another external environment or factors macro environment consists of non-economic environment, political environment, technological environment and socio-cultural environment etc. Business environment has some typical characteristics. It is a constantly changing system. Both short term and long term impact works on business environment. One of the most important characteristics of business environment is uncertainty. Task1 1(a) Identify the purposes of different types of organization There are many different types of organization in our socio-economic life. One organization is different from another organization. They are mission, goal, objective all are different. Some organization purpose is to earn profit, some are non-profit, some are built for mankind etc. let us discuss this different types organization and their purpose. Private organization: The purpose of a private organization is to produce quality products at low cost and become a renowned brand and a market leader. However their...
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...STYLE of management has in recent vears been drawing a great deal of attention from American managers because of its apparent ability to insure organization stability in the face of unexpected external changes. At the same time, a slower rate of economic growth in Japan is compelling Japanese executives to .search for improvement iu management efficiency by focusing their attention on the American type of management. FALL 1977 This trend to draw on each other's strengths in order to better cope with growing external pressures is significant because both eountries now share a similar socio-economic situation characterized by a low rate of economic growth, a high degree of vulnerability to external variations and an advanced stage of technological development. A comparative analysis of the quality of management must first determine what is to be measured. 23 If the criterion is profit performance, most of the major Japanese companies compare favorably with leading American firms, and that is where the comparison ends. What is more meaningful is to measure the extent to which the underlying factors have contributed to profit perfonnance in the past, and how they will continue to function in the new socio-economic setting. These underlying factors consist of entrepreneurial quality, level of aspiration and executive quality. Entrepreneurial (juality is the degree of innovativeuess and propensity for risk-taking. Level of aspiration is concerned with the...
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