Please enable JavaScript.
Coggle requires JavaScript to display documents.
ECONOMIC SYSTEMS, image, image, image, image - Coggle Diagram
ECONOMIC SYSTEMS
AUTHORITY: THE CENTRAL PLANNING SYSTEM
Central planning system, an authority represented by stake thats make decisions
Soviet Union and China are the main examples of this system
Economic system, is to achieve greter social equality
Determinated by the state
Is based on goals set by the state
Mixed economy
Most of the countries have this economy
Is determinated by
Free market
State
Is determinated by the market
State takes action to guarantee equal opportunities
TRADITION BASED ECONOMIC SYSTEMS
In the past people develooped economic systems based on
Customs
Laws
Beliefs
In feudal Europe, artisans formed guilds
CAPITALISM AND THE FREE MARKET SISTEM
Capitalism is a socioeconomic system based on the following factors
Investment of capital
Economic activity in order to maximise potential profits.
Free market
Where the people can put products and sell they products
Private ownership
means of production, which includes physical and financial capital.
Price
Value assigned to a product or service
Supply
the products available on the market for a specific price, during a certain period.
Demand
Products or services that consumers want to buy for a specific price and under certain conditions.
Prices decrease
Supply high but demand low, it creates a surplus
Prices increase
When the demand is high but supply low
