At the beginning of this chapter, you read about the Alibaba Group. Using the information presented in this chapter, you should now be able to answer these questions. (10 Pts)
(To be passed in through Moodle)
- What is the difference between a market economy and a planned economy?
- Explain how managers of Alibaba, eBay, Amazon.com, and other online retailers might view the concepts of supply and demand.
- What economic indicators would a business owner be most likely to watch, and why?
- Does Jack Ma’s success increase or decrease your confidence in a capitalistic system based on private enterprise?
- Should there be more government intervention in the markets and business dealings? Why, or why not?
Explanation & Answer
Running head: ALIBABA GROUP
The main difference between the two types of economies is that in a planned economy there is
only one single person or rather one single group who has the full control of what is produced. In
this case, the business considers bringing their efforts together to produce goods which will be
distributed by the government. On the other hand, a market economy has very little government
interventions in that the government does not control it in whatsoeve...