An Economic System

An economic system can be defined as a country or nation in an organized manner production and consumption of goods and services, including the combination of the various institutions, agencies, consumers, including a specific economic structure of society, or community (loman.J. & Garratt.D., 2013). The basic economic system including three types are free market economy, planned market economy and mixed market economy. The article will explain that through there different economy to analyses the different country how to solve the basic economic problem.
Main body
Every country have common economic problem such as scarcity (land and raw materials, labor and capital) and unlimited wants and limited supply. Land is the naturally occurring materials of the planet that are used for the production of goods and services. The natural resources and materials of the land become the goods produced. Labor is the mental and physical efforts of humans used for the production of goods and services. Labor includes both the physical effort of factory workers and farmhands Capital is the produced factor of production which can increases labor's ability to produce wealth or services. Also, capital is the manufactured goods used in the production of other goods, including machinery.Entrepreneurship is the special sort of human effort that takes on the risk of bringing labor, capital, and land together to produce goods.
These resources often focus on there questions. First one is what goods and services to produce? Second is how should goods and services be produced? Finally, who should get the goods and services produced? Every country always follows these mothods of produce to allocates resources.
Free market economy
Free market is a type of econo...

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