BUSINESS ENVIROMENT

PRESENTATIONS
GROUP 5
THE THREE ECONOMIC SYSTEMS
IN RELATION TO THE CASE OF ZAMBIA
NAMES SIN
Gardner Muhala 18122694
Kabungo Nkonde 18128857
Kalumbilo nathan Kalumbilo 18129941
Christine Mulilo 18121469
Docahs Chibanga 18124626
Musa Nyirongo 18126847
Owen Chilongo 18128814
Aaron Chisenga 18124475
John Kapaipi 18124570
Lusekelo Chimbila 18131497
 INTRODUCTION

• An Economic system is an institutional

mechanism through which resources are utilised
to satisfy human needs .
• There are three main types of economic systems
are :
- Planned Economic system
- Market Economic system
- Mixed Economic system
 Types of Economic Systems
(I) Planned Economic System
• This is a type of economic system in which
decisions about the allocation of resources is
undertaken by the state planning authority.
• They decide what to produce , how much of it to
produce as well as who will attain the goods and
services.
• This type of economic system is not related to the
case of Zambia because in a planned economy it’s
the government which produces while in Zambia
it’s the market that produces.
 Types of Economic Systems(2)

Advantages
• Control Inflation
• There's equal distribution of resources
Disadvantages
• Reduced incentives to work harder
• Miss judgment of customer preferences
• Lack of variety and quality and production
 Types of economies(3)
(ii) Market Economy
• It’s a type of economic system where the allocation
of recourses are done by the price mechanism(no
government intervention).
• The market economic systems is one which is
similar to that of the economic system used in
Zambia because in both a market economy as well
as in Zambia markets are responsible for production
of goods and services.
• Main examples are transport system and Food
reserve agency(FRA).
 Types of Economic Systems(4)
Advantages
• Market mechanism means that resources are
allocated automatically without the need of
government intervention
• By using money votes, the consumer dictates to the
producer through the market what is produced.
• Producers are motivated by profit thus they have
the incentive to respond quickly to change in the
consumers preferences.
 Types of economies(5)
Disadvantages
• Goods and services that are not profitable will not
be produced /run hence parts like rural communities
will suffer.
• Certain goods like Public goods may be under-
provided or not provided at all in a market economy.
(Public goods can be defined as those goods which
when consumed by one individual can still be
consumed by others and from which no one can be
excluded)
 Types of Economic Systems(6)
(iii) Mixed Economy
• Is a type of economy in which the decisions about
what, how and for whom to produce are partly
made by the market and government.
• It contains features of both planned and market
economies with the government intervening in
various ways to influence market prices.
 Types of Economic Systems(7)
Advanatges
• It provides goods or services whenever they are
required: when goods/services become necessary in
specific regions the mixed market economy ensures
that people and organizations get what they require.
• It protects the well being of the general population:
The government is able to inform consumers that
products are safe or unsafe to use.( e.g. ZAMBEEF
embalmed chemicals-2013)
 Types of Economic Systems(8)
Disadvantages
• It brings about unemployment and forces companies
out of business: too much government intervention
and regulation e.g. through taxes and employment
conditions.
 conclusion
• We can conclude by saying an economic system is an
institutional mechanism through which resources are
utilized. The three economic systems namely Market,
planned and mixed economy are important to the
economy cause they provide us with our needs and
services.
• The mixed market economic system is used by a
variety of countries as well as Zambia because it looks
to combine the advantages of both the planned and
market economy, where markets produce but the
Government intervenes if necessary examples given
where FRA and public transportation to be specific
Buses
 Conclusion(2)
• A planned economy is one which is different to the
economic system used in Zambia because in a
planned economy the government gives all
instructions on production while in Zambia the
markets are responsible for the production and
government only intervenes when important.
• A market economy is similar to the economic
system used in Zambia but the main difference Is
that in a free market economy the government does
not intervene while in Zambia the government
intervenes (e.g. zambeef embalmed -2013).