1. Aim: Which economic system would I most want to live under?
Do Now: Renee is in love with Jeff. They have been together for one year and she has been desperate for him to propose. Finally, at a fancy restaurant he gets down on one knee. Renee is about to faint. Jeffery says “Renee, I LOVE YOU. But you know that I’m a broke law student. Please accept this fake diamond and be my wife.” What should Renee say?
NY State Learning Standards 2, 4
Common Core RS 6, WS1

2. Which ring would you prefer? Why?
I What is economics?
Economics studies scarcity (when the resources we need or want are limited). Due to scarcity, Economic Systems have developed that decide how a society makes, distributes and uses its scarce resources.
Which ring would you prefer? Why?

3. Which of the above are limited?
Natural Resources
Which of the above are limited?

4. In a successful economic system, should there be poverty or hunger
In a successful economic system, should there be poverty or hunger? On the flip side, does everyone need to be a millionaire?

5. II The 4 Main Economic Systems
TRADITIONAL
COMMAND
MARKET/
CAPITALIST
MIXED
Based on culture and tradition.
Barter (trade) is used.
All economic decisions are made by the government.
There is supposed to be equal distribution of resources.
Based on supply and demand.
Little government involvement.
Unequal distribution of resources.
Combines elements of a market and command economy. There are publically and privately owned businesses.
Today it is found in third world (undeveloped) and second world (developing) countries.
Found in communist nations such as the former USSR.
Usually found in democracies.
Found in China today.

6. The 4 Main Economic Systems
COMMUNIST BLOC HOUSES: EVERYONE LIVES IN SIMILAR APARTMENTS
DUE TO SEVERE INFLATION, MANY IN ZIMBABWE HAVE TURNED TO BARTER TO GET FOOD, CLOTHES, AND EVEN HEALTHCARE.

7. The 4 Main Economic Systems
IN MARKET ECONOMIES, THE PEOPLE DETERMINE THE PRICE. WHEN DEMAND IS HIGH FOR THE NEW iPHONE, THE PRICE INCREASES. WHEN DEMAND DECREASES, THE PRICE WILL TOO.
AIR CHINA IS OWNED BY THE CHINESE GOVERNMENT. HOWEVER, THERE ARE NOW MANY PRIVATELY OWNED BUSINESSES IN CHINA’S MIXED ECONOMY.

8. III Which Economic System is the best? The worst? You decide!
TRADITIONAL
COMMAND
MARKET/
CAPITALIST
MIXED
POSITIVES
NEGATIVES

9. Key Vocabulary Command Economic System
Third World (Undeveloped) Nation
Economics
Traditional Economic System
Economic System
Market/Capitalist Economic System
Mixed Economic System
Resources
Scarcity
Second World (Developing) Nation