McConnell_Brue_Chapter02

The pure capitalistic market system has no

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Unformatted text preview: ure capitalistic market system has no governmental checks and balances in place and functions much like nature. The system rewards the most efficient resource users and the process becomes economic survival of the fittest. It is the concept of economic survival of the fittest that brings much of the natural efficiency to the capitalistic economic system. Slide 2 Chapter Learning Objectives In this chapter you will learn: 1. The difference between a command system and a market system. 2. The main characteristics of the market system. 3. How the market system decides what to produce, how to produce it, and who obtains it. 4. How the market system adjusts to change and promotes progress. 5. The mechanics of the circular flow model. Chapter 2 2 1 Chapter 2: The Market System and The Circular Flow Slide 3 Each social system must address the issue of deciding how to use scarce resources to produce goods and services, determine how to distribute these goods and services among the members of their society, and discern how to maintain enough flexibility in the system to accommodate change and encourage increasing efficiency over time. Economic Systems Ea...
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This note was uploaded on 09/10/2009 for the course ECO 2251 taught by Professor Kirkland during the Spring '09 term at Troy.

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