Economic Goals - Efficiency, Freedom, Security and Predictability, Growth and Innovation, and Equity

Characteristics	Traditional Economy	Command/Centrally Planned Economy (Socialism)	Free Market/Free Enterprise Economy (Capitalism)
Who answers the three economic questions?	Tradition/Culture	Government
Role of Government	Almost none	To control the economy
Freedom of Choice	Almost everyone has the freedom of choice	Almost no one except the government has the freedom of choice
Ownership of Capital	Everyone owns everything	Government
Price Determination
Higher Priority Goals
Lower Priority Goals

Mixed Economy (Varied levels of Socialism and Capitalism)

• Why are most economies mixed?
  • A mixed economy is the best for a large economy because it gives you the advantages of a command economy and a free market economy and also allows you to minimize the disadvantages of both economies.
• What are some ways that the U.S. government has allowed for some individual control of the economy while still regulating it? Be specific. One is completed for you.
  • The U.S. broke up Microsoft as a monopoly in 2000 to allow for more competition and fairer prices.