Economics - Economic Systems
In attempting to reduce the economic problem, nations develop economic
systems. An economic system is the administrative and organisational
structure that determines:
* What will be produced.
* How it will be produced.
* How the production is distributed.
Economic systems can be distinguished in terms of political ideology and
Political ideology is the set of beliefs that governs the values of a
nation, including the system of property ownership. The options are:
* - a belief that resources should be predominantly owned privately by
individuals and businesses.
* - a belief that resources should be predominantly owned collectively
by the people of a nation and administered by the government on their
Economic coordination is the mechanism that is adopted to convert scarce
resources into goods and services. The options are:
* - a government authority answers the fundamental economic questions of
what to produce, how to produce the goods and services, and who gets the
goods and services.
* - the market forces of demand and supply answer the fundamental
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