What do communism and socialism have in common?
Socialism and communism are alike in that both are systems of production for use based on public ownership of the means of production and centralized planning. Socialism grows directly out of capitalism; it is the first form of the new society. It is the necessary transition stage from capitalism to communism.
What are the major differences between socialism and capitalism?
Capitalism is based on individual initiative and favors market mechanisms over government intervention, while socialism is based on government planning and limitations on private control of resources.
What are the similarities between communism and socialism?
Both communism and socialism seek to establish an equal society through distribution of resources. Both systems, in their ideal theoretical forms, utilize a democratic or participative form of decision making. The key difference between socialism and communism is how resources are distributed and property held.
What are some examples of socialist economy?
In socialist economies, governments are charged with redistributing wealth and narrowing the gap between the poor and the rich. While no modern-day countries are considered to have a “pure” socialist system, Cuba, China, and North Korea have strong elements of socialist market economies.
How much does making a pencil cost?
In this way, how much does it cost to make a pencil? It would cost $50 in labor and materials for a person to make a 10-cent pencil. One million pencils are used annually on the floor of the New York Stock Exchange. The average pencil can be sharpened 17 times and write 45,000 words.
What resources go into making a pencil?
The most important ingredient in a pencil is the graphite, which most people continue to call lead. Conté’s method of combining graphite with clay is still used, and wax or other chemicals are sometimes added as well. Virtually all graphite used today is a manufactured mixture of natural graphite and chemicals.
What kind of transaction makes a free market economy possible?
In a free market economy, the law of supply and demand, rather than a central government, regulates production and labor. Companies sell goods and services at the highest price consumers are willing to pay while workers earn the highest wages companies are willing to pay for their services.