1. Bell Ringer How many different economic systems can you name?
How would you define economics?
What are key factors that make a country developed?

2. Economics:
The social science that deals with the production, distribution, and consumption of goods and services

3. Economies
Market Economy: A system in which the production is owned and operated for profit.
The people are running the businesses.
Mixed Economy: A system in which the production is a combination of both private and state run businesses. Most economies in the world are mixed economies.
The United States is considered to have a mixed economy.

4. Different Forms of Economies
Command Economy
A command economy is an economic system in which the production is controlled by the state.
Cuba, North Korea, and Iran
Traditional Economy
A traditional economy is a system in which the production is the result of ritual, habit, and custom. (It is generational and occurs generation after generation.)
Parts of Africa, South America, Asia, and tribal areas tend to have traditional economies

5. Developed vs. Developing Countries
Social, demographic, and economic indicators distinguish less developed countries from developed countries.
Gross Domestic Product (GDP)
The amount of goods and services produced by a state in one year.
A key indicator of the level of development of a state.
Per Capita GDP
Total GDP number divided by the population to deliver a per person share of GDP.

6. Characteristics of Developed Countries
Good natural resources
Energy
High literacy rates
High GDP
Strong economy
Good medical care
Long life expectancy
Stable government
Examples – United States, United Kingdom, Germany, Japan

7. Characteristics of Developing Countries
Low GDP
High poverty rate
Low literacy rate
Low life expectancy
Unstable economy
Unstable government
Weak industrial base
Examples – Haiti, Kenya, Rwanda, Vietnam

8. Vocabulary Embargo: Suspension of trade with another country.
Boom/Bust Cycle: Up and down cycle of a market economy characterized by alternating periods of economic growth and contraction.
Recession: Short term negative GDP growth in a State’s economy
A decrease in GDP over 6 months
Depression: Long term, persistent negative GDP in a State’s economy
An economic depression is a really long and persistent recession

9. More Information
Africa’s economy depends on its abundant mineral resources.
The Middle East’s economy depends on oil/petroleum.
Many countries economies depend on world demand for their goods to succeed.
Latin American countries have a hard time attracting investments from world groups due to political instability.
Literacy Rate is most often based on the percent of the population over the age of 15 that can read and write.