When a natural disaster occurs the economy can suffer great devastation when it comes to the amount of clean up, deaths, and health problems that come as an aftermath. When dealing with such crisis of an epic proportion for example a hurricane, flood, blizzard, and or forest fire, the economic system that should be chose is critical. The economic system that should be chosen would be a socialism system, â€œAn economic system based on the premise that some, if not most, basic businesses should be owned by the government so that profits can be more evenly distributed among the people.â€( (Nickels, McHugh & McHugh, 2010)) Socialism system would be the best choice because; the need to help the people that were greatly affected from the natural disaster can be met at a high proportion. In a socialist economy the ...view middle of the document...
Social equality is the idea of an socialism economic system, through higher taxes of the wealthy, giving in return to the poor. Therefore the aftermath of the earthquake, left need for placement of many families, in the form of shelter, financial rebuilding, and in health factors. The cause and effects of the socialism system helps in this case. Meaning, because the wealthy are taxed abundantly the poor being the people affected by the earthquake can receive, financial help, shelter, as well as health care.
Looking further into economic systems and practices, another particular practice is capitalism and free market. In capitalism â€œAn economic system in which all or most of the factors of production and distribution are privately owned and operated for profit.â€( (Nickels, McHugh & McHugh, 2010)) In the free marketsâ€ A free market is one in which decisions about what and how much to produce are made by the marketâ€”by buyers and sellers negotiating prices for goods and services.â€( (Nickels, McHugh & McHugh, 2010)) When looking at how the price to heat up homes and business is determined, and why the price goes up during the winter, one must understand the laws they are incorporated in the free market, as well as supply and demand. In the free market the buyer, generally sets the going range for pay for a specific item, and the seller prices accordingly. In corresponded to heat in the winter, the seller is able to go up on the pricing because the demand for heat in the winter is at its most high, than in other seasons, therefore the supply can be a great profit for the gas companies because the abundance of gas needed to heat up homes and business in colder weather.
Nickels, W. G., McHugh, J. M., & McHugh, S. M. (2010). Understanding business. (Tenth ed., pp. 3-41). New York: Mcgraw-Hill Irwin. Retrieved from http://devry.vitalsource.com/