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2.04-US-Economy (1)

2.04-US-Economy (1)

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Published by Moizur Rahman Khan

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Published by: Moizur Rahman Khan on Sep 18, 2012
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05/13/2014

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2.04 U.S.

Economy

Objective 2.04 Understand the United States’ economic system.

Mixed Economy

A combination of a free enterprise (or market) and a command economy. Privately owned businesses and government both play important roles.

The marketplace produces:  cars  health care  technology  food (with some government regulations) The government provides:  defense  education

United States’ Mixed Economy
Free Enterprise/Market Economy

Market Economy Characteristics
Private property ownership.  Freedom of enterprise and Choice  Motive of selfinterest

Competition  System of markets and prices  The market addresses consumer wants

Market Economy
Advantages
Individuals can own businesses and resources  Individuals can buy and sell goods and services  Competition in the market leads to greater choices  Consumers play a great role in the economy

Market economy
Disadvantage

The critical role of the consumer in the market can create a tremendous divide between the poor and the wealthy

United States’ Mixed Economy
Command Economy

Limited Government

The government helps protect people by being a body that monitors public safety through regulatory agencies such as:
Food & Drug Administration (FDA)  Occupational Safety and Health Administration (OSHA)

The government provides some services to take care of people’s needs
Highways--roads and other transportation services  Schools and other public education services

Social Security  Medicare  Defense and public safety

Command Economy
 Advantages
 Consumers

have some protection in the marketplace  Essential services are provided for citizens

Command Economy
 Disadvantages
 Citizens

have to pay taxes so the government can provide services  Some think there is too much government control in the marketplace

United States’ Economy Summary
Largest national economy in the world  A mixed economy  Corporations and other private firms make the majority of microeconomic decisions.

Government has a minimal role in the domestic economy.  Business firms in the U.S. have much less regulation than those in many other nations.

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