+ Bellringer Objective: Compare and contrast different forms of economies across the globe Homework: Complete poster Answer: How do you think America’s economy compares to other countries? Think about: How rich or poor are we? How is our economy doing? How much choice do we have in our country vs other countries?

+ Warm-Up 1. Scarcity means that we have ________________ wants and ____________ resources 2. Which factor of production would natural material like cotton fall under? a. Landb. Labor c. Capital d. Entrepreneurship 3. Which type of business is owned by only one person? 4. How does a corporation make its money? 5. If I owned the local McDonald's, what am I the owner of? a. Sole proprietorshipb. Partnership c. Corporationd. Franchise

+ How do economies answer the four basic economic questions differently? REVIEW: Every country must answer 4 basic economic questions: What to produce? (Guns or butter?) How to produce? (Machinery? People?) How much to produce? (PPC) For whom? (Who can buy them?) In different types of economies, people have more and less control over how they answer these questions—what they produce, how they produce it, how much they produce, and who they produce it for? How do countries decide what to produce? By considering their COMPARATIVE ADVANTAGES: the ability of a country to produce a good at a lower cost than another country Ex. The US imports (buys) manufactured goods (clothes) from China because they have a lot of cheap labor and can make them for much less cost than we can Ex. The US exports (sells) expensive products like airplanes and high tech weapons because we have advanced technology and highly skilled workers And deciding what would increase their GROSS DOMESTIC PRODUCT

+ Look at your country…. What do you have a comparative advantage in (what are you good at…what do you specialize in? Discuss… Now look at the stations… which countries will you trade with? Which countries need your product? (export) Which countries do you need products from? (import)

+ Traditional Economy Definition: Economy based on customs and traditions, includes BARTERING (trading/haggling for goods) Who Answers Qs: Tradition, previous generations EX: Amish, Less developed, tribal nations.

+ Market Economy AKA = Capitalism, Free Enterprise System Definition: Economy based on free choice; No or very limited government involvement. Who Answers Qs: Producers and consumers based on the profit motive Profit motive: people/businesses want to make $$ and will supply/demand a good based on how they can make the most $$ EX: USA 125 years ago, most countries today have some government involvement.

+ Command Economy AKA = Communism Definition: An economy in which there is public ownership of capital goods and centralized planning of production and consumption Who Answers Qs: ONLY the central government = Centralized planning EX: China, Cuba, Vietnam, Former USSR (Vs. Socialism: gov. owns big industries, individuals own small businesses)

+ Mixed Economy Definition: Combination of two economies, usually mixed and market economies. Who Answers Qs: Government and citizens (the gov. regulates some industries by telling us what can/can’t be produced and how) EX: US today Why is the US a mixed economy?

+ ACTIVITY: Working Under the Different Economic Systems You will be participating in an activity that will show you what it is like to live under each of the different systems. The group that produces the most necklaces/bracelets/rings at the end of the period will earn points for their group. You must follow the rules or your group’s total for that round will not be counted! When you are done with each round, we will write a response answering the following questions: 1. What did it feel like to work under this system? Were you efficient? Why or why not? 2. What type of economic system do you think you that was? Why?

+ Karl Marx KARL MARX: “Father of Communism” Believed capitalism would lead to fights between social classes. Believed that communism would lead to a classless society.

+ Adam Smith ADAM SMITH: the “Father of Economics”, developed many famous ideas about capitalism “Invisible Hand”: idea created by Adam Smith that suggests that society benefits when people act in their own interest Laissez-faire: “Let the people do”, people should be free to buy and sell what they want without government intervening

+ John Maynard Keynes Said that gov. should spend $ on programs to improve the economy and help with employment In other words… You’ve gotta spend some $$ to make some $$!

+ Karl Marx: Communism and Command Economies In China …People are told what to produce and how to produce it…even though recently this has been relaxed it is still primarily the governments decision…. They do not have independent businesses…the government owns them…but everyone gets a piece of the pie (argument is it is more equal) Read the guided notes…then listen to Two NPR Stories on Cuba…and create the lists associated with each story emerge-as-cuba-loosens-control emerge-as-cuba-loosens-control

+ Exit Ticket Number your paper 1-10 Write in the correct response to the picture/idea Remember…think about how economic systems are tied to the development level of a country!

+ 1. Name that economy…

+ 2. Name that economy… Government answers basic economic questions…China, Cuba, N. Korea…. Karl Marx: Father of

+ 3. Name that economy… People make the decisions..no government involvement

+ 4. Name that economy…

+ 5. Name that economy… Customs answer basic economic questions

+ 6. Name that economy…

+ 7. Name that economy…

+ 8. Name that economy… People answer basic economic questions Adam Smith: “Father of Economics and the Invisible Hand!

+ 9. Name that economy…

+ Adam Smith’s idea that the government should let people buy and sell what they want

+ Bonus…. Define Laissez Faire…and in two sentences argue if Cuba will be more successful with a more Laissez Faire attitude towards their economy.

+ Name that economy…

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+ People answer basic economic questions

+ Name that economy…

+ Other economic ideas… Adam Smith’s idea that the government should let people buy and sell what they want What Keynes thinks the gov. should do to boost the economy Who is the father of Communism The idea that countries should produce whatever is cheapest to make in their location

+ YOUR TASKS: 1. POSTER: Create a poster representing the four different types of economies. Draw or find a picture in the magazines to represent each one, and write a sentence explaining what it would be like to live in that type of economy.

+ Supply and demand scenarios Create 3 scenarios where the supply and demand curve shift. One must be a supply shift one a demand shift and one a double shift. Draw the supply and demand curve for each scenario and solve each scenario.