Question

Economics studies how society allocates its scarce productive resources (land, labor, capital, and entrepreneurial talent). Prior to beginning work on this discussion, read Chapter 2 in the course text, especially examining Sections 2.2 through 2.4, and respond to the following components:

• Briefly describe the types of economic systems. What is the United States’ economic system and what are the characteristics of this economy?
• What economic role or functions does the U.S. government conduct regularly?
• Why is the U.S. government’s economic role important or unimportant for the U.S. economy? Discuss whether you favor a larger or smaller government role in the economy.

Your initial post should be a minimum of 300 words.

Guided Response: Respond substantively (a minimum of 100 words) to at least two of your classmates’ posts. What is different or similar between your post and your classmates’ posts? What advice could you offer your classmates? Substantive responses use theory, research, and experience or examples to support ideas and advance the class knowledge on the discussion topic.

Answer 1

1. Economic system defines the production, allocation of resoucres and distribution of goods and services within the geographical area. There are different types of Economic system -

• Capitalist Economy :- Capitalism is an economic system in which the production are privately owned. In this type of Economy the Central problem of economy is that no intrusion of goverment and price operate through the forces demand and supply.
• Socialist Economy :- In socialist Economy all important decision related to production , consumption and exchange are made by the government. In this type of Economy government decide what to produce for society.
• Mixed Economy:- It consist of combination of Public Sector and private sector. It features typical of both capitalism and socialism.

2.The US economy is a mixed economy, it features of both Capitalism and socialism. The US economic system is a market system. There is free market for private individual to buy , sell and produce but also US government regulates and guides in some areas like education , courts, hospital , roads, and postal service. Therefore the United States economy is mixed economy. US economy is world's largest economy by nominal GDP. The US government control the part of economy with restrictions and licensing in areas of courts, Education, hospital etc.

The mixed economy holds Economic freedom for individuals but government also intervene for public. There are many charactersticks of Mixed economy:-

• Mixed Economy allows free market for demand and supply of goods.
• The ownership of goods are with private as well as with goverment both.
• In mixed economy there is best allocation of resources.
• It protect the private property.
• There is Co-exsistence of the public and private sectors which give benefits to people's of country.
• In mixed economy there is price mechanism and controlled price.
• Profit Motive and Welfare of society.

3.The economic role and function of U.S goverment conduct regularly - Any goverment generally guides and regulates the economy to help in achievement of Growth and Financial stability. The US government role in economy is same and it can be categories in these important functions-

1. ​​​​​​Economic Stability
2. Growth
3. Full Employment
4. Reduce Poverty.​​​​​​
5. The US goverment regulates the economy to achieve these above given objectives. These Economy functions can not be ignored for a healthy economic development in country.

4.The US government economic role is important or unimportant for US economy because -

1). To maintain the Stabilization and Growth of the Economy. This can be done by regulates good economic activities and a proper plan guide for taxes, fiscal and monetary policy.

2).To increase GDP value of economy. GDP of any country show the overall effeciency and productivity of country.

3).To ensure the full employment situation by performing some important basic function and Fuller utilization of resoucres.

5.Government role in Economy large or small:- This is one of most discuss issue related to government role in Economy. In my view the role of goverment in Economy should be both. Generally in areas related to Public goods and services government intervention is must because goverment exactly know the requirements of public more other than private businesman and indivisindi. But in some cases government can make wrong decisions for public due to some political pressure or wrong policies making.

So it's very important a balance role of goverment in the economy. There should be a extent upto which the government should intervene above that it only harms the Public.

Therefore , a balance role of goverment is important in the economy , not larger or not smaller.