three types of economic ways a country can run

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Feb 11, 2009 Business Two Page Paper There are three types of economic ways a country can run. The first one is capitalism. Next, we have socialism. Finally, we have communism. All three of these ways are used throughout the world weather people know it or not. What market would you like to live in and what do you think they mean? First we have a Capitalism market, which is when your productive resources are privately owned. Also, allocation of resources is by price and the lure of profit. The last thing you want to know about capitalism is that the role of government is limited. Next we have a Socialism market, which puts the governments & direct resources in key industries for their market. After that, the basic productive resources are owned & operated by government, but are still privately owned. Finally, we have our Communism market which means the basic productive resources are owned & operated by governments. Then, the government plans & draws up detailed orders to allocate all resources. The rules you need to study a market economy are: 1. It is a system individual with each by setting their own goals. 2. Preferences are individual- who knows what is in your best interest. 3. The best way to predict how people will behave is in their own best interest as the see it. - Market economy is based upon the belief that individuals act in their own self interest the community as a whole will benefit - We don’t need a central authority to tell us what to do to get things accomplished in the economy. 4. The role of the government is limited. - To see the rules of the game - Enforce property rights - Provide public goods Next we have Adam Smith and his invisible hand. It states the everyone should be free to sell and buy whatever they like the government shouldn’t block out or interfere with the market. Also states the companies would keep the
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