Basic Economics Supply and Demand

Basic Economics Supply and Demand - SupplyandDemand The...

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 Supply and Demand The Three Basic Economic Questions All societies must deal with scarcity and, therefore, must have some way of answering 3 basic economic questions: 1. What goods and services are produced and in what quantities? 2. How are they produced? 3. Who gets the goods and services that are produced? There are two extreme systems for answering these questions. In a communist economy, the government decides all the answers. In a capitalist economy, the questions get answered through the interaction of buyers and sellers in the market. communist economy: government ownership of resources government allocation of resources and the goods and services produced capitalist economy: private ownership of resources use of markets to allocate resources and the goods and services produced Most actual economies contain a mix of private and government decisionmaking. Markets and Prices A market is a place or service that enables buyers and sellers to exchange goods and services.
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  • Fall '12
  • SueBartlett
  • Economics, Supply And Demand, Economic system, producer, demand schedule, $5 4 3 2 1 18 15 8 2 1, $5 4 3 2 1 2 5 8 12 17

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