Economics review


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Economics review

  1. 1. Economics • The science that deals with production, distribution, and consumption of goods and services or material welfare of human kind.
  2. 2. How do different economies answer the basic questions… -What to produce? -How to produce? -For whom to produce?
  3. 3. Entrepreneur - an individual who accepts financial risks and undertakes new financial ventures Bill Gates of Sam Walton of Microsoft Wal-Mart
  4. 4. Types of Systems • Market Economy • Command Economy • Traditional Economy • Mixed Economy
  5. 5. Market Economy • – business owners and consumers decide what to sell and buy
  6. 6. Command Economy • – government decides what is made and sold
  7. 7. Traditional Economy • – “same way we have always done it”
  8. 8. Mixed Economy • – a combination of two or three economy types
  9. 9. Traditional (Same) – “way we have always done it” Market (Choice) – business owners and consumers decide what to Mixed (Two or More) – a combination of two or three economy types Command (Government) – government decides what is made and sold Economies
  10. 10. Most Countries have a Mixed Economy• U.S.A – Mix of Market and Command Economy
  11. 11. Most Countries have a Mixed Economy• Cuba – Mix of Command with Traditional moving toward a Market Economy
  12. 12. Who? What kind? - This government is called the People’s Republic of ….. But the people are just being to receive a voice. Free enterprise is just beginning to become real.
  13. 13. Who? What kind? - This country is a constitutional monarchy. It has very little natural resources. The education system is excellent. The country is know for it’s technical advances. .
  14. 14. Who? What kind? • This country is a • developing • country. The • government is • encouraging • farmers to use • new technology instead of doing things the same old way. Entrepreneurs are investing in this country’s economy.
  15. 15. Continuum: Pure Command to Pure Market Place China, India and Japan on the continuum line. • _____________________________________ Pure Pure Command Market
  16. 16. There is a lack of entrepreneurship in Asia. • This greatly affects the developing economies of the region. List reasons why. Lack of: new businesses, new ideas, employment, developing leadership, new products
  17. 17. • No country can produce everything it needs. • This is due to location, climate, natural resources, technology. • Countries must “specialize”. • They produce what they can and then sell those products to other countries and buy what they need. • This increases the need for voluntary trade among countries. Two or more countries trade with each other, all sell their products and get items they need from the others.
  18. 18. Trade Barriers • Any government imposed restriction that interferes with one country trading with another
  19. 19. Tariffs • A tax placed on goods imported from another country
  20. 20. Quota • Limits the amount of a good imported
  21. 21. Embargo • Any restriction by a government that stops the importing of a good from another country; ban
  22. 22. Why is investment important to a nation’s economy? • Create new products • Develops new ideas • Creates jobs • Raises the standard of living (higher GDP per capita).
  23. 23. Why do countries have currency? • Currency allows people to trade (buy and sell) at an established rate. There is a standard to determine the worth of goods and services. Countries have exchange rates for other countries’ currencies depending on the value of that currency.
  24. 24. Project 1. Divide your cards into goods and services. 2. Then divide the goods into agriculture and products. 3. Total the numbers of each category. (3) agriculture____ products_____services__