Case Study ECONOMICS WORKSHEET: Economic Systems Name: Class: What countries are considered economically free? Who is in control of economic decisions? Are people free to do what they want and to work where they want? Are businesses free to produce when they want and what they choose, and to hire and fire as they wish? Are banks free to choose who will receive loans? Or does the government control these kinds of choices? Each year, researchers at the Heritage Foundation and the Wall Street Journal look at 50 different categories of economic freedom for countries around the world. They give each nation a score based on the extent of economic freedom in each category. The 2015 Heritage Foundation's Index of Economic Freedom report ranked 178 countries around the world: some examples of the most free and the least free countries are listed in Table 1.1. Several countries were not ranked because of extreme instability that made judgments about economic freedom impossible. These countries include Afghanistan, Iraq. Syria, and Somalia The assigned rankings are inevitably based on estimates, yet even these rough measures can be useful for discerning trends. In 2015, 101 of the 178 included countries shifted toward greater economic freedom although 77 of the countries shifted toward less economic freedom. In recent decades, the overall trend has been a higher level of economic freedom around the world. Most Economic Freedom Least Economic Freedom 1. Hong Kong 167. Timor-Leste 2. Singapore 168. Democratic Republic of Congo 3. New Zealand 169. Argentina 4. Australia 170. Republic of Congo 5. Switzerland 171. Iran 6. Canada 172. Turkmenistan 7. Chile 173. Equatorial Guinea 8. Estonia 174. Eritrea 9. Ireland 175. Zimbabwe 10. Mauritius 176. Venezuela 11. Denmark 177. Cuba 12. United States 178. North Korea Table 1.1 Economic Freedoms, 2015 (Source: The Heritage Foundation, 2015 Index of Economic Freedom, Country Rankings, http://www.heritage.org/index/ranking)Questions: 1. What type of economic system is based largely on agriculture and trading of goods and services? [1] A. Traditional economy B. Market/Capitalist economy C. Mixed economy D. Command economy 2. Which type of economy BEST allows some people to become very rich while others may be poor? [1] A. Traditional economy B. Market/Capitalist economy C. Mixed economy D. Command economy 3. Read the statement below then answer the question 3.1-3.3,. \"A market economy, also widely known as a '[free market economy, \" is one in which goods are bought and sold and prices are determined by the free market, with a minimum of external government control. A market economy is the basis of the capitalist system.\" 3.1 Who makes the economic decisions about what to produce, how to produce and for whom to produce, in a free market economy. [1] 3.2 Discuss the involvement of the government in a free market system. [1] 3.3 Interpret the concept "economic freedom", taking into account the statement above as well as the case study. [2] 4. Why are Singapore and Hong Kong regarded as economically free countries? Base your answer on facts rather than assumptions. [2] 5.1 What type of economic system does North Korea have? 5.2 Is there economic freedom in North Korea? 5.3 Do you agree with an economic system such as North Korea? 5.4 Defend your opinion in 5.3 and suggest the best system to follow providing motivation for your suggestion. [1] TOTAL: 10