| A | B |
|---|
| Traditional Economy: | An economic system in which people do things the way they have always done them. A traditional economy is influenced by: Habits, Customs, Religious beliefs |
| Traditional Economy Characteristics | An economic system heavily influenced by habits, customs, and religious beliefs; Children generally “inherit” the occupations of their parents; Difficult to introduce new ideas. |
| Planned Economy: | An economic system in which the government controls and regulates production, distribution, prices, etc. |
| Planned Economy Characteristics | Not affected by financial downturns and inflation; Deliberate planning of the entire money-making process for better results; Emphasizes more on collective benefits, rather the requirements of a single individual. |
| Market Economy: | A market economy is economy based on the division of labor which the prices of goods and services are determined in a price system set by supply and demand. |
| Market Economy Characteristics | Means of production are privately owned; Buyers and sellers are solely responsible for the choices they make; Free market economy is also characterized by free trade without any tariffs or subsidies imposed by the government. |
| Mixed Economy: | A mixed economy can be defined as a form of organization where the elements of both capitalist economy and socialist economy are found. |
| 4 Types of economic systems: | Traditional, Planned, Market, Mixed |
