ADMS 1010 Lecture 3: Agricultire and Manufacturing [p1]
11 Jan 2012
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Document Summary
Contains private ownership and state-ownership of the means of production, infrastructure and institutions. It allows for private financial decisions by businesses and individuals. Government has the power to override these decisions through legislation. A market economy is an economy in which goods and services are traded. Governed by the law of supply and demand. Prices are determined in a separate market for each commodity. Prices act as the signaling mechanism to answer all basic economic questions. Performance criteria of a mixed and market economy. The emphasis is on achieving maximum output per person or per person employed. Freedom of choice is available to both producers and consumers. Buyers and sellers interact to establish prices and exchange goods and services. Cause firms to develop new products, services, and technologies. Consumers get greater selection and better products. Using tariffs or other non-tariffs barriers to lower importation of goods. Attempts to strike a competitive balance between imports and domestically produced goods.
