This document discusses economic concepts including: 1. It defines economic activity as all processes used to obtain goods and services, including three phases: production, distribution, and consumption. 2. It outlines the history of different payment methods from barter to modern electronic payments. 3. It defines a sustainable economy as using resources optimally to achieve long-term balance and profitability. 4. It identifies people, companies, and the state as contributors to economic activity. Production requires natural resources, capital, technology, knowledge, and work.

1. THE ECONOMY
3º ESO
Unit 4

2. 1- What is economic activity?
Economic activities are all the processes used to obtain the good and
services that people need.
There are three phases:
1. Production
2. Distribution
3. Consumption

3. History of payment
1- Barter: direct exchange of goods.

4. 2- Natural coins: valuable natural items.
4- Paper money
3- Metal coins

5. 5- Bills of exchange or cheques. 7- New technologies and online
payment.
6- Plastic and electronic money

6. Sustainable economy
The use of various strategies for employing existing resources optimally so that that a
responsible and beneficial balance can be achieved over the longer term. Within a
business context, economic sustainability involves using the assorted assets of the
company efficiently to allow it to continue functioning profitability over time.
Sources:
http://www.sustainable.org/economy
https://hbr.org/2011/10/the-sustainable-economy
http://www.thwink.org/sustain/glossary/EconomicSustainability.htm

7. 2- What are economic sectors?

8. 3- Who contributes to economic activity?
1. PEOPLE: dual function: workers and consumers.
1. COMPANIES: produce goods and services for a profit. They need people
and other companies. There are different types of company (depending on
their size or their ownership).
1. THE STATE: economic functions (depending on the country).

9. 4- What makes production possible?
1. NATURAL RESOURCES: renewable or non-renewable resources are
necessary to make production possible.
1. CAPITAL: physical, human and financial capital are needed as well.
1. TECHNOLOGY: depending on the use of manual, mechanical or automated
methods, the production and profits can vary.
1. KNOWLEDGE AND KNOW-HOW: to achieve a competitive economy.
1. WORK: both, physical and intellectual. Productivity is essential.

10. 5- Population and work
We need to distinguish economically active and inactive population.

12. How is the labour market organised?
There are different types of paid employment:
● Most people work for an employer in exchange for wages.
● Some workers form cooperatives, they share profits.
● Self-employed workers work for themselves.
Employers and employees formalize working conditions in the contract.
National laws regarding employment contracts should be obeyed.

13. Labour relations. employers and unions.
Collective bargaining is a
process of negotiations between
employers and a group of
employees aimed at reaching
agreements to regulate working
conditions. The interests of the
employees are commonly
presented by representatives of
a trade union to which the
employees belong.

15. The unemployment problem

19. Underground economy
The underground economy is business activity that is unreported or underreported
for tax purposes. It can be particularly widespread in industry sectors where cash
transactions are common, such as retail, hospitality, and construction, including
home renovations…..just to name a few.

20. 6- How are economic activities organized?
The economic activities are the set of activities carried out by human
beings to satisfy their needs.
An economic system is an an organized way in which a state or nation
allocates its resources and distributes goods and services in the national
community.
There are three main economic systems:
SUBSISTENCE
COMMUNISM
CAPITALISM

21. Subsistence system
A subsistence economy is a non-monetary economy which relies on natural
resources to provide for basic needs, through hunting, gathering, and
subsistence agriculture. "Subsistence" means supporting oneself at a minimum
level; in a subsistence economy, economic surplus is minimal and only used to
trade for basic goods, and there is no industrialization.

22. Communist system
A system of government in which the state plans and controls the economy and
a single, often authoritarian party holds power, claiming to make progress toward
a higher social order in which all goods are equally shared by the people.

23. Capitalist system
Capitalism is an economic system in which trade, industry, and the means of
production are largely privately owned and operated for profit.
Central characteristics of capitalism include capital accumulation,competitive
markets and wage labour.
In a capitalist economy, the parties to a transaction typically determine the prices
at which assets, goods, and services are exchanged.

26. Monopoly
A situation in which a single company or group owns all or nearly all of the
market for a given type of product or service. By definition, monopoly is
characterized by an absence of competition, which often results in high prices
and inferior products.

27. Oligopoly
A situation in which a particular market is controlled by a small group of firms.
An oligopoly is much like a monopoly, in which only one company exerts control
over most of a market. In an oligopoly, there are at least two firms controlling the
market.

28. Consumer protection is a group of laws and organizations designed to ensure
the rights of consumers as well as fair trade, competition and accurate
information in the marketplace. The laws are designed to prevent businesses
that engage in fraud or specified unfair practices from gaining an advantage over
competitors.