What is an Economy? Economy and Government Unit

Economy  Economy is the production and exchange of goods and services among a group of people.  Economy can be found at different levels:  Local  Regional  National  International

Four basic types of economy:  Traditional economy  Command economy  Market Economy  Mixed Economy  Think TCM ²

Economic System  An economic system is the way people use resources to make and exchange goods and services.  Can you think of a way that you as teenagers can participate in an economic system?  Think about the Barter system

Traditional Economy  The Barter System: Where goods are exchanged between people but money is rarely exchanged.  Oldest economic system

Command Economy  The production of goods (think of clothes, cars, toys, etc…) and services are decided by a central government.  The government usually owns most of the resources and businesses that make the products or provide the services.

Market Economy  The production of goods and services is determined by the supply and the demand of consumers.  Also known as demand economy; capitalism  United States has an market economy  How do you contribute to the market economy in your nation?

Mixed Economy  A combination of command and market economies provides goods and services  Some countries that have mixed economies:  -United Kingdom - Italy - Canada - Japan - Germany - Australia

Apply your Knowledge  What type of economy is seldom used today?  Why do you think that is true?  Who controls a command economy?  How are command and market economic systems different?