Economic systems refer to the way a society organizes and manages its resources, production, distribution, and consumption of goods and services. Different economic systems include capitalism, socialism, communism, etc.
Think of an economic system as a recipe for baking cookies. Each system has different ingredients (resources), methods (production), ways to share (distribution), and who gets to eat (consumption).
Capitalism: An economic system based on private ownership of resources where individuals pursue their self-interests leading to competition.
Socialism: An economic system that aims for collective ownership or control over resources with the goal of reducing inequality.
Communism: A socioeconomic ideology advocating for common ownership of means of production aiming at creating a classless society.
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