1. Economic Problems
   1. What to Produce?
      1. Scarcity---Can't produce EVERYTHING
      2. Quantities Produced
   2. How to Produce?
      1. Method Of Production
         1. Number of Labour
         2. Equipments
      2. Minimize Cost & Maximize Profit
   3. Who gets the Product?/Distribution
2. Cost of Transition
   1. Output Fall
   2. Inflation
   3. Unemployment
   4. Social Unrest
   5. Poverty & Homelessness
   6. Greater Income Gap
   7. Inadequate Social Security
   8. Crime
3. Planned Economy
   1. Production Decisions Made by Central Government
   2. Distribution: Central Government Direction
   3. Motivation: Public Interest/Price not motivated through Profit
   4. Advantages
      1. Basic Needs(Food,Shelter,Clothing) are met. Merit goods available to ALL
      2. No duplication of production
         1. No Waste of scarce resources
      3. Inflation is well controlled by price regulation
      4. High Employment
      5. Equitable Distribution of Income
      6. Free From Monopolies that keep prices high
      7. Social Costs Reduced
   5. Disadvantages
      1. Slow Reaction to change of needs
      2. Quantity Supplied Mismatches with demand
         1. Over/Under Supply
      3. Poor motivation for business to reduce cost
      4. Difficult to allocate correct Q of Inputs
4. Mixed Economy
   1. Mixture of Private Decision-Making and central organization
   2. Some Resources are owned Privately, while others owned by the GOV
   3. Resource Allocation Problems are fixed by Market forces/central planning/Social custom/Traditions
   4. Main Actors
      1. Government
5. Market Economy
   1. Use Market Forces id est Price to solve the problem of resource allocation
   2. Consumer Sovereignty
      1. Reallocate Resources, respond to consumer demand
   3. Distribution: Price Mechanism
   4. Motivation: Self Interest/Price Motive/Market Forces
   5. Advantages
      1. Decisions made quickly
      2. Resources Allocated Efficiently
         1. "What to Produce" based on consumer demands
      3. Resources are used Efficiently
         1. Quick Responses to changes in consumer taste
   6. Disadvantages
      1. Inequitable Distribution of Income
      2. Merit goods in short supply
         1. need, rather than ability and willingness to pay/Socially Desirable Goods
      3. Non-Provision of Public Goods
         1. Parks/Schools/Road/Lighting
      4. Monopolies
         1. Price Rise
      5. Private firms lead to social costs
         1. Unemployment
         2. Pollusion
         3. Flawed Products
      6. Economies or trade cycle
         1. Depression/Boom/Slump
      7. Duplication of Production Leads to Waste of Resources
         1. Railway
         2. Airport
         3. Gas
         4. Water Supply
      8. Market Failures