Download Latin American Economics Study Guide

Latin American Economics Study Guide
1. What would be the most important factor in deciding what job you would
want to do in a traditional economy?
You have to follow the traditions of your culture
2. List the types of activities that are often part of a traditional economic
system.
Farming, Fishing, Sewing, Masonry, Baking, Building
3. Define command economy. (more than a few words):
Where the government makes most of the decisions for businesses
4. What is one problem that Cuba faces in a command economy?
The people cannot make decisions about their own businesses
5. In which system do consumers make economic decisions based on changes
in prices that occur between buyers and sellers?
Market (Supply & Demand)
6. Describe the economy of Cuba. (more than a few words):
They have a very strict Command economy where the government is in
charge of all business
7. Describe the economy of Brazil. (more than a few words):
They have a Market economy so the people have more freedom to make
choices for themselves
8. Which country has the least freedom to do business?
Cuba
9. What makes Brazil a more desirable place to trade than Cuba?
They have less restrictions from their government
10. An economy that is a blend between command and market is a what?
Mixed Economy
11. Draw the economic continuum and place the following countries in the
correct position:
Cuba, Brazil, Russia, and the UK
12. What is an advantage of specialization?
Each country becomes an expert at their product
13. What is a tariff?
A tax on imported goods
14. What is a quota?
A limit on imported goods
15. What is an embargo?
A ban on all trade with a country
16. Imports go IN , exports go OUT.
17. What does NAFTA stand for?
North American Free Trade Association
18. What was NAFTA’s main purpose?
To encourage trade between Canada, Mexico, & the USA
19. List the pros of NAFTA.
Increases profit, countries can specialize, creates jobs for Mexicans,
products can be made cheaper
20. List the cons of NAFTA.
USA lost jobs, low wages for Mexicans, Mexican workers not treated fairly
21. What is the money of a country called?
Currency
22. What is the currency of Mexico?
Pesos
23. Why do people have to exchange currency?
So they can use the currency of whatever country they are in to pay for
goods and services.
24. Give 3 examples of investment in human capital.
Education, Healthcare, Housing
25. Give 3 examples of physical capital.
Machinery, Appliances, Vehicles
26. What does investment in human capital increase GDP?
When you invest in the PEOPLE, they will be more successful in the future
and bring money into the country
27. Why does investment in physical capital increase GDP?
When you invest in the JOB, the workers can be more efficient and make
more money
28. Which natural resources are the greatest help to some of the countries
in Latin America?
Oil, Fishing, Food
29. Which country in Latin America has the fewest entrepreneurs and why?
Cuba, because they have a strict command economy so people cannot open
their own businesses without government permission
30. List 10 natural resources.
Trees, Oil, Gold, Diamonds, Silver, Fish, Apples, Oranges, Potatoes, Stone