Descriptions of Economic Systems1. State planners in Asgard met to decide what the country should focus on producing. After muchdeliberation, they decided it would be in the country’s best interest to use their limited resourcesto produce automobiles instead of other consumer goods, such as electronics or textiles. The stateplanners passed their decision down to factories, and allocated to them raw materials, workers, and other resources needed to produce automobiles. Factories were then told how much theyshould produce with these resources and who the final products should be shipped to. How do you know?2. In Summerland, business owners decide what to produce, how much to produce, and who toproduce for. The CEO of Guardian Audio, one of the leading audio equipment producers in thecountry, recently decided to increase production levels of the company’s newest MP3 playermodel, and at the same time decrease production levels of their most popular CD player. Thereason for the emphasis on MP3 players is that demand for CD players has decreaseddramatically as MP3 technology has taken over the market. Simply put, there is more profit to bemade in the MP3 market. How do you know?3. In Wonderland, people rarely engage in market transactions. For the most part, they do notneed to. Families grow their own vegetables and raise their own animals or hunt to get meat. Certain times get tough for people in Zenn-La, like when the winters are particularly cold or animalschange their migration patterns. For this reason, it is important that families stock up in "goodtimes" and develop relationships with neighbors with whom they can share or trade. How do you know?4. In The Merry Olde Land of Oz, business owners make most economic decisions. As long asthey abide by fair trade policies, they can decide what to produce, how to produce, and for whomto produce without government intervention. These decisions are made by business owners basedon what happens in the market. For example, a computer manufacturer recently developed a newvideo gaming system, but decided to wait until closer to the holidays to release the system to thepublic because it believed anticipation among consumers would allow the company to charge ahigher price for the system. How do you know?