(often referred to as a centrally planned economy) is one in which all dimensions of economy activity, including pricing and production decisions, are determined by central government planning authorities.

resources are primarily owned and controlled by the private sector.

indicator of the number of units of a country’s currency required to buy the same amounts of goods and services in its domestic market.

economic system characterized by a mixture of market and command economies, including a combination of public and private ownership.

percentage increase in the change in prices from one period to the next, usually a year.

Low- and middle-income nations World Bank

implies the liberalization of economic activity, the reallocation of resources to their most efficient use, macroeconomic stabilization, the privatization of state-owned assets, budgetary constraints and the development of an institution and legal framework to protect property and individual rights.

allocation and control of resources engaged in economic activity.

indicates that a country’s cash outflows (payments) exceed its inflows (receipts).

indicates that a government’s expenditures exceed its revenues

characterized by the state ownership of significant resources, but the allocation of those resources comes from the market price mechanism, and prices are determined by the laws of supply and demand.

The broadest measure of economic activity, _____ represents the market value of final goods and services newly produced by domestically owned factors of production.

high expenses than revenue

3 types of Economy under the Classified Countries by Economic System

is computed by dividing GNI by a country’s population. Because nominal exchange rates (unadjusted market rates) do not always reflect international differences in prices

occurs because aggregate demand is growing faster than aggregate supply. Ultimately it affects interest rates, exchange rates, the cost of living and the general confidence in a country’s political and economic systems.

measures the cost of a fixed basket of goods and services and compares the price from one period to the next.

history is often used to forecast future economic trends, it is certainly not perfect. Further, there exists significant differences in growth rates throughout the world.

composition of local demand (quality of demand), the size and growth of local demand (quantity of demand) and the internationalization of basic demand; they are crucial for market-seeking investments.

engaged in economic activity—the public sector (government), the private sector, or both.

are rarely a problem.

3 KEY MACROECONOMIC ISSUES AFFECTING BUSINESS STRATEGY

value of production that takes place within a nation’s borders, without regard to whether the production is carried out by domestic or foreign factors of production.

(the right to choose what to buy), the freedom of market entry and exit and the determination of prices according to the laws of supply and demand.

High-income nations

essential inputs to the production process ; human resources, physical resources, knowledge resources, capital resources and infrastructure; they are crucial for investments made for production purposes.