Economic Systems Chapter Review Key Terms Checklist Using a pencil, place a ¸ in each box to indicate how well
you know and understand each Key Term. q I know and understand this Key Term.
q I am still a bit uncertain about what this Key Term means. q I don’t understand this Key Term yet.
When you revise each chapter, tick the boxes again to indicate how much you have learned.
1. 2. 3. 4.
5. 6.
7. 8.
An economy exists wherever people and businesses engage in producing, selling, buying and consuming goods and services.
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Resource allocation means deciding what goods and services to produce, how to produce them and for whom to produce them.
The private sector is not owned by the state. It consists of individuals or organisations that are free to set up and run businesses and supply goods and services to anyone.
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The public sector refers to organisations owned and controlled by the State, including government departments and State agencies.
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An economic system refers to the way in which an economy decides what to produce, how to produce it and for whom. q q q A centrally planned economy is one in which most economic decisions about what to produce, how and for whom are taken by public sector organisations.
A free market economy is one where most economic decisions are made by private individuals and organisations.
A mixed economy combines government planning and ownership of some resources with the use of private enterprise and markets.
