Economic Systems
The economic system deals with the production, distribution, and consumption of goods and services, or the material welfare of humankind. The problem that the economic system needs to deal with is: there are unlimited needs and wants but scarce resources, for example coal in Australia is used a lot, but it is a scarce resource in that it is running out.
Resources used in a economic system are the assets that we use for jobs such as construction or manufacturing companies which would use tools like factories, vehicles or other machinery - this is referred to as capital. The area or field where you would do your jobs such as farming or selling houses this is called land. People who participate in the production process in return for material and rewards formed in wagers or salaries this is named as labour, An enterprise is a company or business that leads labour, land and capital All of these aspects (commonly known as the factors of production) make an economic system, so in summary an economic system a is a way in which a state or nation administers these scarce resources shares out goods and services to satisfy our needs and wants in our nation. |