2. Name Date Period Seat : : Supply and Demand Traditional Economy Command Economy 1.Pick up a piece of paper as you Walk into the room. 2. Fold your paper like the Illustration to the left..Please write the terms in the correct locations. You will be writing information in the space provided

3. Market Economy Mixed economy Back Side of your paper

4.  Icons: Traditional communism Market Mixed economy

5.  Economy: Production or exchange of goods and services by a group › Goods: things to be traded, bought, or sold › Services: work done in exchange for payment › Labor: work force, the workers

6.  What is Economic Geography? › Concerned with how people use the earth’s resources › How people earn a living › How products are distributed

7.  Custom and tradition determine what should be produced  Goods and services are exchanged without money; subsistence agriculture  Change and growth proceed very slowly  Often there is no private property; things are owned by the family or village  Goods and services are produced to meet the needs of the members of the family/tribe  Very little outside trade  Also called “Barter”

8.  All important economic decisions are made by government leaders, including production of goods and services  Cooperation is supposed to replace competition, allowing everyone’s needs to be met; goal is to achieve a classless, equal society  Citizens can be assigned or strongly encouraged into various employment  Private property ownership is abolished and replaced by national ownership of all land, factories, farms, and major resources  Also called “planned economy” or “communism”  Example: Cuba, China, North Korea, Vietnam

9.  Goods and services are determined through supply and demand; individual decisions on what to buy or sell  People are free to take part in any business, buy any product, or sell a legal product.  Private ownership of businesses and land; private investment  The government only provides and enforces a set of common rules, maintains monetary system, and will sometimes break up or regulate companies that could defy market forces  Also called “free market economy” or “capitalism”  Example: USA

10.  Combination of command and market economies  Mixed amounts of government control and private ownership  Example: Canada, most European countries

11.  Supply: how much of a good is available on the market  Demand: how much consumers are willing to pay for a good  The interaction of supply and demand determines prices in a free market economy. When demand is high, the price goes up. It the supply is high but demand is low, the price goes down.