Macroeconomics: Principles, Problems, & Policies 20th Edition

Published by McGraw-Hill Education
ISBN 10: 0-07766-077-3
ISBN 13: 978-0-07766-077-2

Chapter 2 - The Market System and the Circular Flow - Review Questions - Page 49: 1

Answer

A. Command System. B. Market system. C. Laissez-faire system.

Work Step by Step

Command System - If a person wants to start a shop, they have to get a permit from the government so it is a command system. Market system - The decisions about production and distribution are determined by the individual. The government collects tax for promoting public work and does not interfere. Laissez-faire system - The government is protecting the country from outside forces and maintains laws. That expense is paid for through taxes.
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