1. ECONOMIC
STRUCTURES

2. Joe's
$$$$$$$$$
JOE
JOE is an
“Entrepreneur”

3. (Someone who starts a business)
QUICK NOTES
Entrepreneur:
A person who takes a risk to produce goods and services in search of a PROFIT!
(Someone who starts a business)

4. 3 Structures of Businesses
QUICKNOTES
3 Structures of Businesses
Proprietorship:
Partnership:
Corporation:

5. PROPRIETORSHIP
Joe's
$$$$$$$$$
JOE
“Entrepreneur”

6. 3 Structures of Businesses
QUICKNOTES
3 Structures of Businesses
Proprietorship: One owner who takes all the risks and all the profits.

7. PARTNERSHIP
JOE & BOB’S
Joe's
$$$$$$$$$
$$$$$$$$$
BOB
JOE

8. 3 Structures of Businesses
QUICKNOTES
3 Structures of Businesses
Proprietorship: One owner who takes all the risks and all the profits.
Partnership: 2 or more owners who share all the risks and profits.

9. Joe now “shared” his company with all the stockholders.
Remember Joe?
Remember how Joe sold stock in his company so he could make his company bigger?
Joe now “shared” his company with all the stockholders.
JOE
Stockholders

10. $$$$$$$$$$$
$$$$$$
$$$$$$
$$$$$$
$$$$$$
$$$$$$
$$$$$$
JOE
Stockholders

11. WHAT IS A CORPORATION?

12. 3 Structures of Businesses
QUICKNOTES
3 Structures of Businesses
Proprietorship: One owner who takes all the risks and all the profits.
Partnership: 2 or more owners who share all the risks and profits.
Corporation: A business authorized by law to act as a legal person regardless of the number of owners. Owners share profits. Profits depend on how much was invested.

13. CIRCULAR
FLOW

14. CONSUMERS
PRODUCERS
GOVERNMENT

15. …LET’S LOOK
AT THIS “FLOW”
A LITTLE
MORE CLOSELY…

16. CONSUMERS PRODUCERS GOVERNMENT
JOE’S
PRODUCERS
GOVERNMENT

17. Economic Flow (Circular Flow)
QUICKNOTES
Economic Flow (Circular Flow)
Individual and business saving and investment provide financial capital that can be borrowed for business expansion and increased consumption

18. BUSINESS FLOW CONSUMERS PRODUCERS SELL GOODS LAND CAPITAL
SELL SERVICES
LABOR
WAGES
BUY SERVICES
RENT
JOE’S
PRODUCERS
BUY GOODS
INTEREST
PROFITS

19. Economic Flow (Circular Flow)
QUICKNOTES
Economic Flow (Circular Flow)
Individual and business saving and investment provide financial capital that can be borrowed for business expansion and increased consumption
Individuals (households) own the resources used in production, sell the resources, and use the income to purchase products
Businesses (producers) buy resources; make products that are sold to individuals, other businesses, and the government; and use the profits to buy more resources

20. CONSUMERS PRODUCERS GOVERNMENT
JOE’S
PRODUCERS
GOVERNMENT

21. BUSINESS FLOW CONSUMERS GOVERNMENT SERVICES LABOR WAGES SERVICES
INTEREST
GOVERNMENT
TAXES
BENEFITS

22. CONSUMERS PRODUCERS GOVERNMENT
JOE’S
PRODUCERS
GOVERNMENT

23. BUSINESS FLOW GOVERNMENT PRODUCERS SERVICES TAXES BUY SERVICES
SELL GOODS
BUY GOODS
SELL SERVICES
JOE’S
PRODUCERS

24. Economic Flow (Circular Flow)
QUICKNOTES
Economic Flow (Circular Flow)
Individual and business saving and investment provide financial capital that can be borrowed for business expansion and increased consumption
Individuals (households) own the resources used in production, sell the resources, and use the income to purchase products
Businesses (producers) buy resources; make products that are sold to individuals, other businesses, and the government; and use the profits to buy more resources
Governments use tax revenue from individuals and businesses to provide public goods and services

25. CONSUMERS PRODUCERS GOVERNMENT
JOE’S
PRODUCERS
            
GOVERNMENT

26. BUSINESS FLOW

27. REMEMBER THE GREAT DEPRESSION? Stock Market Crash
Investors lose all their money
People lose jobs
Those who bought stock on margin cannot pay back banks.
Businesses fail…there are no investors!
People lose life savings
Banks fail