Unformatted text preview: e points, we will also be able to see how
amazing a market system truly is. • Who owns the factors of production.
• The method used to motivate, coordinate, and
direct economic activity. Chapter 2 4 Learning Objective 2-1 2 Chapter 2: The Market System and The Circular Flow
5 Two general types of economic systems exist today:
command systems and market systems.
• Historically, command systems have been
associated with sot or communist political
• Alternatively, a market-based approach typically
referred to as capitalism has historically been
most commonly associated with democratic
political systems. What types of economic systems exist?
Command economic systems known as
som or communism.
Market systems known as capitalism. Chapter 2 5 Learning Objective 2-1 Slide
6 Command Economic Systems
In command economic systems the government owns
most of the property and controls decision making
when seeking to answer the economic questions of
what to produce, what to use to produce it, and who
gets it, etc.
These decisions occur thr...
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