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Transcript
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