Download The Basics of Economics Needs vs. Wants

The Basics of Economics
SS6E5 The student will analyze different economic systems. a. Compare how
traditional, command, and market economies answer the economic questions of 1 –
what to produce, 2 – how to produce, and 3- for whom to produce. b. Explain how
most countries have a mixed economy located on a continuum between pure and
market and pure command.
SS6E7 The student will describe the factors that cause economic growth and examine
their presence or absence in Europe. a. Explain the relationship between investment
human capital (education and training) and gross domestic product (GDP). b. Explain
the relationship between investment in capital goods (factories, machinery, and
technology) and gross domestic product (GDP). c. Describe the role of natural resour
in a country’s economy. d. Describe the role of entrepreneurship.
Needs vs. Wants
Wants and Needs are Produced from Limited Resources
Limited: only a_________amount
Resources: things used to provide what we need or want
Factors of Production:
Land resources: land, soil, plants, animals, water, oil, and metals.
Labor resources: the_________people do with their hands and their
minds (carpenters, singers, teachers, etc.)
Capital resources: the ________ used to _________other goods
(buildings, machines, technology that creates more technology)
Goods versus Services
Goods are things you can ________, or ________ or hold in your hands.
Goods must be _______ or made by someone.
Services are the ______people provide to make goods ___________
(pizza delivery guy, hair dresser, dentist, etc.)
3 Basic Economic Activities
An economic activity is anything people do to meet ________and
________. The things people do to provide _______ and ________ can
be divided into three groups. We call these groups the basic economic
activities. The 3 groups are:
Taking materials from the earth
Making things, and
Providing services
What To Produce
Kinds of Economic Systems
How a country answers the 3 economic questions _________ the form
of economic system.
The 4 major economic systems are:
Traditional
Command
Market
Mixed
____________ Economy: makes decisions based on what has been done
in the _________ People produce the goods and services they have always
produced. (herd cattle, produce clay pots)
Video Notes: Traditional Economy
Command Economy
In a ____________economy, __________ leaders decide the ___________ to the
basic economic questions. The government___________the land, labor, and capital
(the three factors of production).
In a command
economy who
answers the three
basic econ
questions?
_________
_________
_________
_________
_________
_________
_________
_________
Video Notes: Command Economy
Market Economy
A market economy is the __________ of a __________ economy. In a market
economy, each _______________ answers the 3 basic questions (what, for
whom, how).
People make decisions for _____________.
Mixed Economy
_________ nations in the world have a _______economy. A mixed economy is
one which is part __________ and part _________ economy. Most
governments have________say over how the 3 basic questions are answered.
However, many ___________are left up to the ___________.
What areas do you
think the government
controls in the USA?
__________________
__________________
__________________
__________________
__________________
__________________
__________________
__________________
__________________
__________________
__________________
__________________
__________________
1.
A.
Which economic system do you think consumers (like you)
would like the most?
Command
B. market
C. traditional
2. Which economic system would be the worst for competition
between produces?
A. Traditional
B. commandC. market
3. A market economy has ________ ownership of property and
resources.
A. Private
B. government
C. tribal
4. Which economic system is found in simple agriculture societies?
A. Traditional
B. commandC. mixed
5. What is the most common economic system?
A. Command
B. mixed
C. traditional