Question

Briefly explain the three types of economic system and how do they resolve basic economic problems

Answer 1

Answer:

An economy is a system whereby goods are produced and exchanged. Without a viable economy, a state will collapse. There are three main types of economies: free market, command, and mixed. The chart below compares free-market and command economies; mixed economies are a combination of the two.

The three major types of economic systems are traditional, command, and market. Traditional economy is based on customs and beliefs. Command economy has government leaders controlling factors of production. Market government has individuals making decisions themselves.