2 Minute Writing Identify two facts you learned in your reading about economic systems.

Topics of Discussion Key Economic Questions Types of Economic Systems Our Economic System Mixed Economic Systems Emerging Market Economies

Key Economic Questions What goods and services are to be produced? How should the goods and services be produced? For whom should the goods and services be produced?

What To Produce? We all differ from what we want Businesses CANNOT meet all of the people’s wants Use your resources wisely Decide which goods and services would best serve your nation

How To Produce? Business may or may not have… Equipment to do a job efficiently Man power to effectively do a job More capital resources = Less human resources

For Whom To Produce? Whose needs and wants are most crucial? Additional questions: How will the goods and services be distributed? Should the goods and services be shared equally among the people? Should people who contribute more to producing the goods and services be able to get a larger share of them?

Economic Systems Used to answer the key economic questions Custom-Based Economy (Traditional) Goods are produced the way they always have been. Direct (Planned) Economy Resources are owned and controlled by the government.

Types of Economies Market Economy Generally found in countries that have demographics forms of governments. Marketplace: Any place where buyers and sellers exchange goods, services, and some form of money. Mixed Economy Combines…. Government ownership and Private ownership United States is a mixed economy

Answer the Economic Questions Teams of 6 or 7 2 group members per question How would your assigned economy answer the economic questions?

Our Economic System Capitalism Economic resources are usually privately owned by individuals rather than by the government. Free (Private) Enterprise System Freedom of the individual to choose what to produce or buy

Our Economic System Private Property Own, use, or dispose of things of value. Profit Competition Freedom of Choice Make your decisions independently, and accept the consequences.

Emerging Market Economies More controlled environment All workers could get the same wages regardless of job title or skill level

Supply and Demand Key Terms consumer producers demand supply market price

PARTICIPATING IN A MARKET ECONOMY Consumers Individuals) purchasing the products Sets demand Producers Businesses) generating the products or determining what’s for sale. Establish supply

Demand Quantity of goods or services that consumer is willing to buy. The Demand Curve Relationship between price and quantity demanded by consumer

Supply The quantity of goods or services that businesses are willing and able to provide. The Supply Curve Price and Quantity a business will supply.

Factors Determining Demand Customers wanting a particular product will result in an increase of price. Switching from one product to another No Close Substitute Opportunity Cost

Factors Determining Supply Price of the product Competition Natural Disasters

Market Price Supply = Demand Competition

Chapter 1 Review Due by the end of the period TOMORROW (9/17)