Chap003.1 - z Cuba z North Korea z China z Bureaucracy...

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1 Supply and Demand: An Introduction Chapter 3 - Supply and Demand: An Introduction Slide 2 Supply and Demand: An Introduction ± How do we get the goods and services we want in the right quantities and qualities? z Many goods and services are allocated by the market forces of supply and demand. ± Why do some goods and services have shortages or surpluses? z Some good and services are regulated by the government. Chapter 3 - Supply and Demand: An Introduction Slide 3 What, How, and for Whom? Central Planning Versus the Market ± Three Problems All Economic Systems Must Address z What should be produced? z How should it be produced? z For whom will it be produced? Chapter 3 - Supply and Demand: An Introduction Slide 4 What, How, and for Whom? Central Planning Versus the Market ± Centralized Economic Organizations z Former Soviet Union
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Unformatted text preview: z Cuba z North Korea z China z Bureaucracy Chapter 3 - Supply and Demand: An Introduction Slide 5 What, How, and for Whom? Central Planning Versus the Market Under central planning, a small number of individuals z Establish production targets for factories and farms, z Allocate labor and other resources needed to achieve the goals, and z Decide who gets to consumer the goods and services produced. Chapter 3 - Supply and Demand: An Introduction Slide 6 What, How, and for Whom? Central Planning Versus the Market Under free-market economic systems, individual choices determine z Which careers to pursue, z Which products to produce or buy, z When to start and shut-down a business, z Who gets what based on individual preferences and purchasing power....
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This note was uploaded on 02/20/2012 for the course ECON 202 taught by Professor Brightwell during the Spring '08 term at Texas A&M.

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