Free Enterprise versus Socialist Economies
6th Grade · Social Studies · 45 min
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Learning Objective
I can compare free enterprise, socialist, and communist economies in different countries.
- 1
In a planned economy, the government controls the factors of production, whereas in a free market economy, individuals own the factors of production.
- 2
The circular flow model shows how households, businesses, and the government interact in a modern economy through the exchange of products, resources, and money.
- 3
Most modern economies are mixed economies that combine elements of both free markets and government intervention, falling on a spectrum between command and free market systems.
