Question

In this discussion forum, you will explore efficiency and fairness as they relate to economic markets.
Examine the use of different allocation methods.

Describe three different methods of allocating scarce resources.Explain how these allocation methods may affect quantity demanded, equilibrium price, and quantity supplied.Explain your arguments using relevant course material and personal experience.

Answer 1

The optimal utilization of the scarce resource is the main problem of the economy. In order to solve them, every country follows its own economic system as follows

Free market economy demand and supply determines the allocating the resource.The price of the goods and factors determined by price.The quantity demanded in the economy and supplied in the economy determines by changes in the price goods and service.Example the USA, UK, Australia

Command Economy all the economic resource owned by government hence the quantity demand and supplied determined by the government the price of the goods and factors decided by the government.Example China, North Korea

Mixed Economy where the operation of free-market economy and government plays role in allocating the resources the certain sectors of the economy in the hand of the government remaining in the hand of private sectors.Example India, Bangladesh.