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Georgia Coach, Economics, High School Mixed Economies Today, there are very few pure command systems or pure market systems. National economies are based on various combinations of market forces and government intervention. At the very least, governments enforce property rights, contracts, patents, and copyrights. They provide a stable supply of money to make voluntary exchange between producers and consumers possible. In European nations such as Sweden, France, and Germany, the government pro- vides extensive economic "safety nets" to protect workers, consumers, and families from the dangers of the market system. In nations such as the United States, Canada, and England, on the other hand, most economic decisions are based on markets, with only limited government controls. Still, the United States government plays an important role in providing goods and services such as public schools, highways, parks, and low-income housing. In Chapter 4, you'll learn more about the role of government in the United States economy. Show What You Know Compare and contrast command and market economies by answering the questions and filling in the chart below. Command Market Who owns resources? Who answers economic questions? How important is competition? How well does it respond to changes? How important is fairness? How much security is there? How much freedom is there? Duplicating any part of this book is prohibited by law. Lesson Practice DIRECTIONS Circle the letter next to the best answer for each question. Thinking It Through 1. The MAIN reason that modern command In a command economy, the government makes all economies have failed is economic decisions. The government must figure out how to make and distribute the thousands of different things that A. consumers demanded more freedom people need and want. in the marketplace B. housing prices were too high and luxury goods were unavailable C. government decision-making led to shortages and inefficiency D. governments favored public works over consumer goods .. , A market economy depends on 3. One weakness of market systems is that A. private ownership and control of A they allow producers very little resources freedom 3. government ownership and control of B. the cannot guarantee security and resources fairness C. an equal distribution of wealth C. they do not respond quickly to change D. limited competition and profits D. they provide very few choices for consumers HINT A market economy uses voluntary exchange between private producers and individual consumers, based on prices and the laws of supply and demand, Duplicating any part of this book is prohibited by law. 4/4
