1. ECONOMIES AND GOVERNMENTS Chapter 4 Section 3

2. I. Economies of the World A. a system that includes all of the activities that ppl and businesses do to earn a living B. Economic Activity 1. ways ppl make a living a.farming b.manufacturing c.services

3. 2. level 1 - primary industry a. traditional economy b. provide natural resources or raw materials to others 1. farming 2. fishing 3. mining

4. c. provide raw materials 1. grain 2. seafood 3. coal

5. 3. Level 2 - secondary industries a. use nat. resources or raw materials to manufacture goods b. manufacturing: changing raw materials into finished products 1. furniture 2. automobiles

6. 4. level three – tertiary industry a. goods and services exchanged b. sell products made in secondary industries c. provide services 1. healthcare 2. mechanics 3. teachers

7. 5. level 4 - quaternary industry (US) a. highest level b. research and distribution of info c. ppl have specialized skills and knowledge 1. architects 2. lawyers 3. scientists

8. 6. Economic Systems a. most countries have mixed economies b. traditional 1. ppl grow own food and make own goods 2. trade thru barter: exchange w/out $ 3. found in rural and remote communities

9. i. farmers ii. fishermen iii. hunter-gatherers iv. herders

10. c. market economy (US) 1. based on private ownership, free trade and competition 2. individuals and businesses free to buy and sell what the wish 3. price determined by supply and demand 4. AKA capitalism or free enterprise

11. d. command economy 1. central gov’t makes all economic decisions - what goods to produce, how much to produce, and what price will be 2. No. Korea and Cuba close to pure 3. Communist gov’t have command economies

12. II. Economic Development A. level of econ. growth and quality of life B. Economic Indicators 1. measures of a country’s wealth 2. Gross Domestic Product (GDP): the value of all goods and services produced w/in a country in a single year

13. 3. per capita GDP: total GDP divided by the number of ppl in that country 4. level of industrialization 5. overall quality of life a. industries and technology b. healthcare and education