1. Economics

2. Vocabulary
Economy-
A system for producing, and distributing goods and services to fulfill peoples wants (needs)

3. Vocabulary Capitalism - Free Enterprise or Free Market
A type of economic system where the individual decides how goods and services will be produced and distributed
Little to no government control of the economy

4. Vocabulary Socialism-
A type of economic system where the government controls the major industries in a country (electric companies, oil, health care)
The government decides how these goods and services will be produced and distributed. Some private ownership is allowed.

5. Vocabulary Communism-
The government owns and controls all the production of goods and services
There is no private ownership, everything is owned collectively by the people and the government decides who gets what and who can use what.
Cuban Flag

6. Vocabulary Anything that is accepted as payment for goods and services
Money-
Anything that is accepted as payment for goods and services

7. Vocabulary
Supply-
The amount of a product made and sold in an economy at a certain price

8. Vocabulary
Demand- Amount of people who want to buy a good or service at a certain price

9. Vocabulary Securities, stocks and shares-
Ownership in a business or corporation

10. Vocabulary
Buyer- A person who is willing to buy goods at a certain price

11. Vocabulary
Seller-
A person willing to sell a good or service at a certain price

12. Vocabulary
Goods- Physical products that can be bought or sold Examples-- food, clothes, car

13. Vocabulary
Services-
Work that you will pay another person to do for you
Examples--fix your car, go to a doctor, take care of your yard

14. Vocabulary
Invest-
To place your money into business, the stock market or other areas of the economy where you hope your money will make a profit

15. Vocabulary
Budget-
A plan for how you will spend and save money

16. Buyer’s cost - Seller’s cost = Profit
Vocabulary
Profits-
The money you have left over after you subtract what it cost you to make something from what you were able to sell it for
Buyer’s cost - Seller’s cost = Profit

17. What is an economy?
An economy is a system for producing, and distributing goods and services to fulfill peoples wants (needs).
You must have human wants in order to have an economy.
Everyone wants something.

18. Human Wants? 2 types of wants that an economy helps to provide:
Physical- food, water, oxygen, shelter, clothing
Items that keep you alive.
Emotional- love, feel good about yourself, happy.

19. Factors of Production
The resources that produce the goods and services that satisfy people’s wants.

20. Factors of Production Land-
Soil, minerals, water, animals, plants that grow on the Earth
Basically, it is all of the Earth’s natural resources.

21. Factors of Production
Labor - The time and energy it takes people to produce goods and services

22. Factors of Production
Capital- Is anything that can be saved and used to produce other goods and services Examples- tools, machinery, or money

23. Test Yourself
An ______________ is a system, in which goods and services are produced, and distributed to satisfy peoples’ wants.
2. Name the three (3) factors of production.
3. The three factors of production are combined together to make _____________ and ______________ to satisfy people’s wants.

24. Test Yourself
An ECONOMY is a system, in which goods and services are produced, and distributed to satisfy peoples’ wants.
2. Name the three (3) factors of production. LAND, LABOR AND CAPITAL
3. The three factors of production are combined together to make GOODS and SERVICES to satisfy people’s wants.

25. Types of Economies Traditional Command Socialism Communism Market
Capitalism
Mixed

26. Types of Economies Traditional
An economic system based on traditions and customs
Most traditional economies are found in less developed countries of the world.

27. Types of Economies Command
The government or central authority decides how the factors of production will be used
Many command economies are found in dictatorships.

28. Command Economy
This theory was started by Karl Marx and Friedrich Engel and includes:
Communism
All factors are owned by the government
2. Socialism
Wealth should be distributed equally
Karl Marx 

29. Types of Economies 3. Market
In this type of economy private individuals decide how the factors of production are used, and how goods and services are produced and distributed.
There is little or no government control of the economy.
It is based on competition for profits.

30. Types of Economies 4. Mixed
A combination of different types of economies
Examples- Capitalism and Socialism

31. Test Yourself
1. ___ One of the two creators of communism A. Adam Smith
B. Traditional
2 . ___ This type of economy has little or no private C. Karl Marx ownership of property, and the factors of
production D. Communism
are owned collectively. E. Social ism
F. Capitalism
3. ___ How the factors of production are used
in this type of economy are based on customs and traditions
4. ___ Author of The Wealth of Nations.
5. ___ Type of economy where the government controls the
major industries in the country; and provides many services
for the people, but this comes with very high taxes.
6. ____In this type of economy the individual controls
the factors of production and decides how they will be used.
7. Why is America considered a mixed economy?

32. Test Yourself 1. C One of the two creators of communism A. Adam Smith
B. Traditional
2 . D This type of economy has little or no private C. Karl Marx ownership of property, and the factors of
production D. Communism
are owned collectively. E. Social ism
F. Capitalism
3. B How the factors of production are used
in this type of economy are based on customs and traditions
4. A Author of The Wealth of Nations.
5. E Type of economy where the government controls the
major industries in the country; and provides many services
for the people, but this comes with very high taxes.
6. F In this type of economy the individual controls
the factors of production and decides how they will be used.
7. Why is America considered a mixed economy? ALTHOUGH WE ARE PRIMARILY A MARKET (CAPITALISM) ECONOMY, WE HAVE SOME SOCIALISM IN THE FORM OF WELFARE AND SOME OTHER PUBLIC SERVICES.