ALLOCATION OF GOODS AND SERVICES
Different methods can be used to allocate goods and services. People acting individually or collectively through government, must choose which methods to use to allocate different kinds of goods and services.
At the completion of Grade 8, students will know the Grade 4 benchmarks for this standard, and also understand:
Scarcity requires the use of some distribution method, whether the method is selected explicitly or not.
There are essential differences between a market economy, in which allocations result from individuals making decisions as buyers and sellers, and a command economy, in which resources are allocated according to central authority.
People in all economies must address three questions: What goods and services will be produced? How will these goods and services be produced? Who will consume them?
National economies vary in the extent to which they rely on government directives (central planning) and signals from private markets (prices) to allocate scarce goods, services, and productive resources.
As consumers, people use resources in different ways to satisfy different wants. Productive resources can be used in different ways to produce different goods and services.