… and the questions they each have to answer. ECONOMIES OF THE WORLD! … and the questions they each have to answer. Intro to Economics

Economies of the World Traditional Market Command What to produce How to produce For whom to produce

SS6E5 The student will analyze different economic systems. a. Compare how traditional, command, and market, economies answer the economic questions of 1 - what to produce 2 - how to produce, and 3 - for whom to produce.

Question one! What should we produce? Food? Clothing? Shelter? Entertainment items/services? Healthcare? Education?

Question two! How do we produce it? By hand? In factories? Small businesses? Big businesses? Do adults make the products? Do children make the products?

Question three! Who are we producing it for? Everyone? Only the rich people? Only the poor people? Only for certain groups?

Traditional Economy What should we produce? Question one! The basics! The most basic things necessary to live.

Traditional Economy How do we produce it? Question two! Mostly by hand or using basic tools.

Traditional Economy Who are we producing it for? Question three! Ourselves, our families, or to barter if we have too much

Market Economy What should we produce? Question one! Whatever people will buy.

Market Economy How do we produce it? Question two! Whatever way is cheapest!

Market Economy Who are we producing it for? Question three! Whoever will buy it If no one will buy it, we won’t produce it (supply & demand)

Command Economy What should we produce? Question one! What the government thinks people will need

Command Economy How do we produce it? Question two! By assigning jobs to the citizens By using whatever capital resources available (including older factories and machines)

Command Economy Who are we producing it for? Question three! We are producing it for every citizen, so everyone can have an equal amount

What is the difference between commercial and subsistence farming? Commercial Farming Subsistence Farming Growing enough food to feed large populations. *Think: Commercials on TV” Survival Farming; enough for themselves and their families.

Market Command

Import vs Export Import Export Good coming in to your country Goods exiting or leaving your country Come on in !!! See you later !!!

Public vs. Private Businesses Businesses owned by the government. Examples: Court houses, schools, post office, fire stations, police stations. NOT government operated. Examples: retail stores, grocery stores (Wal-Mart, Target, Publix)

National vs. International One country More than one country

National vs. International National Flights International Flights One country More than one country

Entrepreneur The person responsible for bringing the human, capital, and natural resources together to start a business. Human Resources (Capital): Workers with appropriate education and training. (Examples: Teachers, Cashiers) Capital Resources: Things needed to start a business (Machines, factories, technology) Natural Resources: Useful materials found in nature, such as: land, water, forests, minerals, soil. (Example: tree, fruit)

You are the proud new owner of a new chicken restaurant You are the proud new owner of a new chicken restaurant. Come up with a unique name. Now you must bring together your human, capital and natural resources. Make a 3 column chart for Your resources. List 5 resources that would fall under each column that you will need to make your business a success.

Your Unique Name Human Resources Capital Resources Natural Resources

Economics Goods: Products(footballs, make-up, iPods, computers) Services: An action performed for money (example- doctor, hairdresser) Consumer: Person who buys and uses goods and services. Producer: Person who makes or provides services. Distribution: Getting goods passed out to where they need to go

Specialization vs. Diversification Relying on only one crop or product Pros – can make things faster, cheaper, and usually better quality. Cons – If something happens to that one product you may go out of business Diversification Relying on more than one crop or product Pros – there are more choices Cons – Quality may be lacking, can be more expensive

Specialization vs. Diversification Relying on only one crop or product Pros – can make things faster, cheaper, and usually better quality. Cons – If something happens to that one product you may go out of business Diversification Relying on more than one crop or product Pros – there are more choices Cons – Quality may be lacking, can be more expensive

Specialization vs. Diversification Relying on only one crop or product Pros – can make things faster, cheaper, and usually better quality. Cons – If something happens to that one product you may go out of business Diversification Relying on more than one crop or product Pros – there are more choices Cons – Quality may be lacking, can be more expensive

Specialization vs. Diversification Relying on only one crop or product Pros – can make things faster, cheaper, and usually better quality. Cons – If something happens to that one product you may go out of business Diversification Relying on more than one crop or product Pros – there are more choices Cons – Quality may be lacking, can be more expensive

Decide if the following businesses are specialized or diversified.