Question

• 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.

Answer 1

Types of economic systems

1.     Command economic system

2.     Market economic system

3.     Mixed economic system

The United States uses the mixed economic system

Some of the characteristics of this economic system include;

1.     Private establishments in the economy might need licenses from the government in order to operate

2.     Private transactions are allowed under certain conditions

3.     The government controls certain services such as education, healthcare, courts and postal services

4.     The government also provides subsidies to sectors such as the agricultural sectors.

The economic roles the U.S government conducts regularly include;

• Promoting economic stability and growth
• Regulating and controlling the economy

Step-by-step explanation

Command economic system- this is a type of economic system where there is a centralized authority controlling significant portion of the economy. The authority is usually the government.

Market economic system-it is a type of economic system based on the concept of free market. There is little government control in the economy

Mixed economic system-it is that economic system which involves both the characteristics of command economic system and market economic system

The U.S government's role in the economy is important because sometimes the market forces that drive the economy do fail and the government's intervention is very necessary to ensure efficiency and effectiveness of the economy.

I favor a larger government role in the economy. There are so many reasons as to why I can take this stand, the crucial roles played by the government include;

Overcoming the market failures- market failures are always there in any economy and government involvement is needed to correct some of these failures.

The government ensures there is equality. That is equal share of resources

Sometimes disaster may happen, government intervention may help in the disaster relief