September 13 & 14 (39) Identify characteristics of free enterprise. 10/6/2015 September 13 & 14 OBJECTIVES REMINDERS (35) Explain the three basic economic questions. (39) Identify characteristics of free enterprise. (42) Compare the American economic system to other economic systems. DECA dues paid by 9/26 Chapter meeting 9/28 CLOSURE Describe the ‘miracle’ of making of a pencil as it relates to global economics. TODAY’S AGENDA QOTD Mixed Economies

Mixed Economies Quick Review! 10/6/2015 Mixed Economies INTRODUCTION TO BUSINESS & MARKETING Quick Review! What are the three basic economic questions? What do they tell us about a nation’s economy? List the three categories of economic systems.

Task #42 Mixed Economies Example: 10/6/2015 Task #42 COMPARE THE AMERICAN ECONOMIC SYSTEM TO OTHER ECONOMIC SYSTEMS. Mixed Economies Example: The U.S.A. is a mixed economy with strong characteristics of a market economy. Government has some involvement in business. Government influence is limited by laws and regulations. No economy is purely any one economic system. Mixed economies have industries that are either operated or regulated by the government. They also have individually owned enterprises.

Types of Mixed Economies 10/6/2015 Types of Mixed Economies Capitalism Socialism Communism Nations in the world today typically represent one of three mixed economies.

Capitalism Characterized by: Role of Government Private Ownership 10/6/2015 Capitalism Characterized by: Private Ownership Freedom of Competition Results in Unequal Classes Role of Government Support the people Take care of those who cannot care for themselves

Think About It… Capitalism is characterized by private ownership & competition without government interference. What is an example of two companies that compete against each other? Our government also provides support… What are some of our government-regulated industries? Agriculture Pharmaceuticals (FDA) Health Care (ACA)

ensure standard of living 10/6/2015 Socialism Characterized by: Government Ownership of Key Industries Goal of Social Equality Results in Higher Taxes Role of Government: Access to Social Services ensure standard of living

Communism Goal of Economic Equality Results in Class-less Society 10/6/2015 Communism Goal of Economic Equality Everyone works & shares. Results in Class-less Society Some refuse to work All share resources No supervision required

Communism Today Characterized by government control Role of Government 10/6/2015 Communism Today Characterized by government control Role of Government Provide for the needs of all individuals Protect society’s interests

Comparing Mixed Economies What do all three mixed economies have in common? Role of Government is to Support People What is the primary difference between each economy? Ownership of Resources Level of Control Capitalism Socialism Communism

Task #39 The United States of America 10/6/2015 Task #39 IDENTIFY CHARACTERISTICS OF FREE ENTERPRISE. The United States of America Our capitalist economy operates according to the principles of free enterprise.

What is Free Enterprise? 10/6/2015 What is Free Enterprise? Free enterprise is driven by the concept of supply & demand. Free enterprise is characterized by: Competition Freedom of Choice Private Enterprise Profit Motive 10

I, Pencil An Essay by Leonard E. Read (1958)

Think About It… IN YOUR NOTES 10/6/2015 Think About It… IN YOUR NOTES Describe the factors of production required to make a pencil. Natural Human Capital AT YOUR TABLE What might cause the pencil-making process to change? Is there a “master mind” driving the creation of a pencil?

I, Pencil, am a complex combination of miracles: a tree, zinc, copper, graphite and so on. But to these miracles which manifest themselves in Nature an even more extraordinary miracle has been added: the configuration of creative human energies--millions of tiny know-hows configurating naturally and spontaneously in response to human necessity and desire and in the absence of any human masterminding! Leave all creative energies uninhibited. There's no limit to what we can accomplish. - Leonard E. Read

10/6/2015 Exit Ticket FRONT Explain why people all over the world voluntarily spend hours making parts of a pencil, even if they don’t actually want or need a pencil. BACK (STICKY SIDE) Your Name