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economic system - Coggle Diagram
economic system
capitalism and the free market system
Capitalism
socioeconomic system
capiatalism is based on
private onership
its person owns there things
investment of capital
in order to maximise potential profits
free market
we can buy an sell things
with out the permision of the goverment
free market is based on the prices established by ...
supply
the products available on the market
demand
the products or services that consumers want to buy
prices
prices decrease
supply high + demand low = surplus
prices increases
demand high supply low = shortage
authority
authority
is generally represented by state
this system was most developed in communist countries
the aim
achieve greater social equality
prevent the injustices
caused by the unequal distribution of wealth
state
makes a number of predictions
based on a set of economic objectives
to determine which goods or services they should produce
north korea
countries that still follow this system
tradition based economic systems
in the past
base
beliefs, customs and laws
guilds
groups formed by artisans
determined how the trade should be carried out
established rules of of production for each trade
production
strictly defined by rules from very old customs
in order to benefit the community
in the present
produccion
costantly changing
technological inovations
tradition-based societies
they have experience a little change
in some places
economic activities are still based on tradition
tradition based systems
production is restricted to
self-consumption
subsistence
the mixed economy sistems
Most countries have a mixed economy system
this system try to about
negative effects of the unequal distribution of wealth in a free market
the lack of efficiency that characterises authority-based systems
