What is an Economic System? Briefly describe the three types of economic systems?
An economic system is how you buy and sell things. Barter- Leads to efficiencies of specialization, but trade is hindered by lack of appreciate units. Controlled economy-Someone is in charge making decisions, but the economy eventually stagnates through entropy, lack of innovation and bad decisions. Free Market economy- leads to growth through individual prosperity(note Adam Smith’s the invisible finger in The Wealth of Nations), but monopolies arise and distort the market.
