There's more than one way for a society to organize its economy. Maybe everyone simply follows tradition, following pretty much the same economic pursuits as their parents and grandparents before them. Or maybe the government decides what's best. Or perhaps the government stays out of it, leaving the economic system to be determined by the combined decisions of millions of individual people.
In modern practice, most large industrial economies – including that of the United States – offer some balance between the last two approaches, with individuals mostly left to do their own thing but with the government still intervening into economic affairs in important ways.
Read on to understand the key features of that mixed economy… and to understand how it's changed in the past, and how it may change again in the future.
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- What is a mixed economy?
- What is a market economy?
- What is a command economy?
- How did the government’s role increase during the Great Depression?
- How did President Reagan attempt to reduce government’s role in the economy?
So, you think it's easy to make the big decisions? Take your turn in the hot seat.
The situation: As President of the United States, you need to make call on how to reduce carbon emissions without killing the economy. There are no shortages of opinions from scientists, politicians, environmentalists, and industry lobbyists. But who's right and who's blowing smoke? And what about your upcoming re-election bid?
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