Unit 2 Study Guide- Economic Systems

1. What is an economic system?

2. Give a brief description of each of the four economic systems.

Economic System Description

Traditional

Free Market

Mixed

Command

3. Give two real-world examples of each of the economic systems.

Traditional Free Market Mixed Command

4. Explain the difference between public and private property.

5. Give three examples each of public institutions and private businesses.

Public Institutions

Private Businesses

6. What is the relationship between taxation and public goods?

 7. How would each of the economic philosophers handle the following issues:

Income Taxes

Smith

Hayek

Keynes

Marx

Government intervention during a recession

Smith

Hayek

Keynes

Marx

Regulation on businesses

Smith

Hayek

Keynes

Marx
 Short Answer Questions

1. Choose and name one of the four major economic philosophers and explain how they would handle
one of the following economic issues:
● K-12 Education
● Income Taxes
● Trade with Other Nations

State their position and why that would be their position. Be specific and explain with examples. Include
another philosopher that would agree with them or a philosopher that would disagree with them.

2. a. Explain at least one positive and one negative aspect of both command systems and free market
systems (four aspects total).

b. Choose a topic discussed in class (public schooling, income tax, police and fire forces, etc.) and
explain whether you think the US should take a capitalist or socialist approach to this issue and why.