Entrepreneurship involves starting new businesses to meet market needs or opportunities. Successful entrepreneurs help economies grow by creating new products/services, jobs, and tax revenue. While risky, entrepreneurship drives innovation.
2. SS7E5. C. Compare and contrast the
economic systems in Israel, Saudi
Arabia, Turkey, and Iran
3. Has almost no natural resources or
farmland
Developed good relations with much of
Western Europe and the United States
Economy based on advanced technology
4. Rich oil reserves
Profit from oil allows them to buy most goods they are
unable to produce themselves
King and his advisors make most decisions about how and
where to spend the oil profits
Invested much wealth in technology and services which
allows them to produce goods not usually found in a desert
climate
5. Great oil wealth
Command economy has not been efficient
in recent times
Shift to a more mixed economy
Despite the oil wealth, the Iranian people
do not share in the money
6. Least economic freedom of these four countries
In earlier times, the gov’t has controlled airlines,
railroads, telephone, and television
Recently the gov’t has loosened its hold on these
industries
Have allowed some private ownership
More laws have been passed to protect business owners
7. 1. The economies of Israel, Saudi Arabia, Turkey, and
Iran could best be described as….market, command,
mixed, or traditional?
2. How have the Israelis made up for their lack of
natural resources?
3. Which industry does the gov’t of Saudi Arabia
heavily control?
4. How has the king of Saudi Arabia used the profits
from oil to help other areas of his kingdom?
9. Not every country can produce the goods and services
it needs
So they “specialize” in producing a good or service
that they can produce most efficiently
They can then trade that product for goods and
services they need
Way to build a profitable economy and earn money to
buy what it needs
Saudi Arabia specializes in the production of oil and
gas.
Israel specializes in agricultural technology even
though they have a limited supply of farm land.
10. 1. What is “economic specialization”?
2. Saudi Arabia specializes in the production
of?
3. Israel specializes in?
11. B. Compare and contrast different
types of trade barriers such as tariffs,
quotas, and embargos
12. Anything that slows down or prevents one
country from exchanging goods with another
Some protect local industries from lower priced
goods made in other countries (keeps competition
away)
Some created due to political problems between
countries
13. Tax placed on goods when they are imported
into one country from another
Purpose is to make the imported good more
expensive than the similar item created locally
“protective tariff”-protects local
manufacturers from competition
14. Different way of limiting the amount of
foreign goods than can come into a
country
Sets a specific amount of particular goods
that can be imported in a certain time
frame
15. When one country announces that it will no longer
trade with another country in order to isolate the
country and cause problems with that country’s
economy
Usually result of a political dispute
1973-OPEC decided to stop all sales of oil and gas to
countries supporting Israel in the 1973 Arab-Israeli
war
16. 1. What is a tariff?
2. What is a quota?
3. What is an embargo?
17. c. Explain the primary function of the
Organization of Petroleum Exporting
Countries (OPEC)
18. Created in 1960 by countries with large oil supplies
Countries wanted to work together to regulate the
supply and price of oil exported to other countries
First five countries: Kuwait, Iraq, Saudi Arabia, Iran
and Venezuela
Continue to decide how much oil they will produce
and that determines the price on the world market
Basic principles of supply and demand
19. 1. Why was OPEC created?
2. What happens to the price of oil when
OPEC countries decide to limit the
production?
3. Where are most of the OPEC countries
located?
20. A. Explain the relationship b/w
investment in human capital and gross
domestic product
21. The knowledge and skills that make it possible for
workers to earn a living producing goods and
services.
Companies that invest in human capital generally
earn higher profits.
Countries that invest in human capital generally
have higher production levels of goods and
services.
This can lead to a higher gross domestic product
than countries that do not invest in human
capital
22. Determined by taking the total value of all goods
and services produced by a country in a single year.
Wealthy countries generally have a much higher
GDP than developing or underdeveloped countries.
Countries in SW Asia have widely different GDP
levels
Countries that make it possible for workers to have
education and training generally have higher
GDPs.
23. Much access to education
Economy depends on technology industries to
make up for country’s lack of natural resources
Many citizens work in industries related to
medical technology, agricultural tech., mining and
electronics
Highly developed service industries
GDP very high b/c of its investment in human
capital
24. Main industry is as an exporter of oil and petroleum
products.
Technology involved in oil industry requires education
and much training.
Also have modern communications and transportation
systems
Enormous building projects
These economic factors require investment in human
capital
Saudi Arabia has a high GDP
Some citizens still practice traditional economic
activities like farming and herding
25. World’s fifth largest producer of oil
Oil industry requires well-trained and
educated workers
Have well respected schools and
universities
However, in recent years, Iranian
government has not done a good job of
regulating the parts of the economy that are
under gov’t control.
26. Why have the Israelis made a big investment in
human capital?
Why would the Saudi oil industry need a large
investment in human capital?
One of Iran’s biggest problems with their state-run oil
industry is::
If a country does not invest in its human capital, how
can it affect the country’s GDP?
27. B. Explain the relationship between
investment in capital and GDP
28. Factories, machines, and technology that people use to
make other goods
Can increase production, which can increase profit which
can increase GDP
Israel
Invested heavily in capital goods
Also invested heavily in technology used in defense industry
Saudi Arabia
Invested heavily in capital goods
Especially in technology needed in oil, transportation, and
communication
Iran
Has made great investments in capital goods related to oil
production, technology and communication
Also spends a great amount on technology for its defense
industry
29. What are capital goods?
Israel has invested heavily in capital goods
in all of the following areas EXCEPT…..
31. One of most important and valuable resources in
the Middle East
Most of the worlds’ industrial nations depend on a
steady supply of oil and gas
U.S. imports nearly half of all the oil it uses,
almost 18 million barrels every day
Over half of the world’s known supplies of oil
come from countries in the Middle East
32. Israel
Has practically no oil at all
Economy depends more on technology than natural resources
Saudi Arabia
Has very few natural resources other than oil
Very influential in world economy and OPEC
The gov’t has modernized roads, schools, airports, and
communication systems
Iran
Most valuable resource is oil
85% of country’s money comes from the sale of oil and
petrochemicals
1/3 of population works in agricultural areas
Political problems have led to economic difficulties
Member of OPEC, therefore benefits by keeping the price of oil high
in the world market
33. Why are oil and gas such valuable natural resources?
How much of the oil used by the U.S. has to be
imported every day?
How has the Saudi gov’t used its national wealth to
change the country?
How do Iran and Saudi Arabia benefit from belonging
to OPEC?
How has Israel’s lack of oil affected that country’s
economy?
35. Creative, original thinkers who are willing to take
risks to create new businesses and products.
Willing to risk their own money (usually) to
produce new goods and services in the hope that
they will earn a profit.
Only about 50% of all new businesses are still
operating after three years
Important asset to a strong economy