Download Study Guide # 4

Study Guide # 4-2: Economics
Use the information and your knowledge of social studies to answer the
question.
Deng Xiaoping permitted peasants to sell crops from their own private plots at
local markets if they first produced a quota. Motivated by the incentive to make
a profit, peasants yielded increased agricultural production. Deng also allowed
citizens to start their own businesses, to hire people to work, and to earn a profit
from the labor of others. He also created many Special Economic Zones for
foreign investors to build factories, use cheap Chinese labor, and export goods.
Despite this success, China still lacked efficient energy and transportation
systems.
--adapted from History Alive!
1 Did Deng Xiaoping move China’s economy more towards a command
economy, a socialist economy, or a market economy than his predecessor?
2 What causes consumer shortages in nations like China and Russia? Lack of
efficient energy and transportation systems, lack of technology,
strict government regulations, and control over product availability.
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Use the information in the box to answer the question.
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natural resources
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labor

capital

entrepreneurs
3 The above list is known as the 4 Factors of Production
4 What important economic questions do these help societies answer? What
to produce? How? For whom?
5 Identify the country that sits on both Europe and Asia. RUSSIA
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The highest goals of people in a traditional economy are economic stability and
security. Most want nothing more than to live as they always have, following
traditional ways of life, in harmony with nature. For most traditional societies,
though, this goal is increasingly difficult to attain. Traditional economies have
become shrinking outposts of the past surrounded by the modern world. As
modern economies exert an ever-growing influence, traditional societies are
struggling to find a path to economic survival.
6 How would the goals of a command economy and a market economy differ
from those mentioned above in a traditional economy? In a command
economy, the government controls production, prices, and salaries.
In a market economy, people are allowed to start a business, make a
profit, and buy consumer goods. It’s free enterprise with little
government interference.
7 How must people and corporations behave in a free enterprise system in
order for it to function effectively? Morally or ethically. They have an
obligation to operate with high values and not cheat the customer.
Also, “White Collar” crimes should be eliminated. People should
never steal from their own business.
8 The nation of France has a mixed economy. It has a free enterprise system
with strong socialist systems to ensure that its citizens have economic
security. France is part of a large group of nations on what continent?
EUROPE
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9 France and many of its neighbors are a part of a special relationship
commonly referred to as the European Union
Use the image and your knowledge of social studies to answer the
question.
10 Tell me where this occurred, why it was happening, and where situations like
this are most likely to happen. Just outside of Tiananmen Square –
Beijing, China. This gentleman was protesting the earlier use of
force by the military who was responsible for the deaths of hundreds
of citizens. These situations are more likely to happen in countries
that have unlimited governments and don’t allow nonviolent political
protests.
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Use the information and your knowledge of social studies to answer the
question.
11 What types of economies are pictured here? Create a Venn diagram to show
their similarities and differences. Left: Traditional, Right: Market
Similiarities: a variety of choices of goods, little government interference
Differences: Traditional may trade goods for goods with no currency
involved. Also, a region or country’s culture is a big part of their
economy and they’ll produce what has always been produced.
In a market, money is exchanged, more choices on products and newer
items to buy. Also, a higher standard of living allows for more luxuries.
Finally, market economies produce what will make a profit.
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Use the information and your knowledge of social studies to answer the
question.
Cuba
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

Estonia
Distribution of Goods and
Services In Cuba, there are often
shortages of basic goods, including
food. Because of these shortages,
people have to depend on the
government to ration,
or give out, small amounts of food.
Poor government planning is also a
problem
Government Policies The
government controls all imports and
exports. Money to start new
businesses is generally unavailable
in Cuba. Therefore, the government
must buy goods
from other countries, especially fuel,
tractors, and food.
Level of Economic Development
The people of Cuba suffer from lack
of food and poor living conditions.
Cuba’s GDP per capita is a meager
$1,800—one of the lowest in the
world.
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

Distribution of Goods and
Services Estonian consumers can
make their own decisions about
what to buy. Companies compete to
win customers and make profits.
This competition
often results in better goods and
services. Prices are usually set by
the market forces of supply
and demand.
Government Policies Government
has focused on the idea of “trade,
not aid.” The government uses no
paper and has made a real jump to
modern technology. 44% of their
exports are electronics.
Level of Economic Development
Estonia has greatly improved their
GDP over the last ten years. Its
GDP per capita is $47,400.
12 Using the information above, identify which statements are lies and which
statement is true. Reword the lies to make them true statements.
There are many benefits to a free-enterprise system. True
Government policies encourage spending in command systems. False.
Does not encourage…money is unavailable.
Consumers have equal advantages in both socialist and market
economies. False. Advantages in market economy
When companies compete, government planning is required. False.
Competition results in better goods and services. No
government aid.
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Use the information and your knowledge of social studies to answer the
question.
Manufactured Goods
13 . Manufactured goods are produced from what factors of production?
Natural Resources first. Labor second.
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Use the information and your knowledge of social studies to answer the
question.
Despite some remarkable efforts by masses of people to complete large projects
for their communes, the policies of the Great Leap Forward failed. Poor
management of the People’s Communes caused many problems. Commune
officials usually kept imprecise records of which workers did what, and some
peasants learned how to work very little and receive free benefits.
14 Why were some workers unmotivated to do their best? They get paid the
same regardless of how hard they work
15 How does this undermine an economy? Workers will not work as hard
and produce less because they will get paid the same amount no
matter how hard they work
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Use the information and your knowledge of social studies to answer the
question.
Estonia’s GDP from 1995 until 2010
Year
GDP in millions
1995
9.049
2000
13.595
2005
22.394
2010
24.689
16 What type of data would be appropriate to use in a circle graph (pie chart)?
Problems involving a part to whole relationship usually with
information listed as percentages. Ex.: Percentage of products that
make up Estonia’s GDP.
17 When would a line graph be the best use of giving a pictorial representation
of data? A line graph is used to show trends or changes over time.
Ex.: The above chart would be best because you could show the
increase every 5 years with a line graph.
18 Why would someone use a map to explain data? On a global scale, one
could show where an item of data is spread out throughout the
world (maybe with shading) or to show where natural resources
occur.
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19 What type of data could a double bar graph be used for in order to
convey information to a reader? Data comparing 2 countries or
segments of a population where each double bar shows different
categories.
20 Using the chart above which type of graph would be the most appropriate?
Line graph
21 Explain the differences between a market economy, a command
economy, and a traditional economy. Market economy promotes free
enterprise with products available for consumers and profits attainable when
running a business. Also, there is little government interference. A
command economy has government control when it comes to setting the
prices of goods and services, producing what government committees decide
to produce. A traditional economy will produce what has always been
produced and will rarely use currency or money. Also, a country’s culture is
a big part of their traditional economy.
22 Explain the process of oil formation. The remains of plants and animals
sink to the bottom of a sea or ocean. Over time, most of their
remains turned to rock. The weight of the water, heat from the
earth’s core, and chemical changes combine to transform some of
the remains into oil and natural gas.
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23 List things that promote a European cultural identity. Flag, currency,
European citizenship, lifting of tariffs for easier trade
24 List things that would work against building a cultural identity in Europe.
Different languages and unique cultures (religions, celebrations,
foods).
25 What do you think this map would be about? Petroleum (oil) resources
found in the Middle East
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In order for a country to become wealthy it must have four factors of
production: land, labor, capital and entrepreneurship. The nation of Yemen has oil
reserves of 2.8 million barrels but has a GDP rate of $2,700. Clearly, Yemen has
one of these factors of production.
26What could explain why Yemen’s GDP rate is so low? They are missing
labor and entrepreneurship and possibly capital.
27How would this graph look different if the countries of Europe were shown
individually rather than as a group? Each European country would have a
lower GDP than India.
28What would this tell you about their ability to compete on the global stage?
Together as the EU, the European countries can compete on a global
stage because they have enough resources. Individually, their
economic power is severely lessened.
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29Describe the process shown in the above flow chart. Shows how
petroleum (oil) is created and how it becomes useful products for
people to use
30What are some of the products gained from this process? Plastics,
gasoline, clothes, shingles, etc
31How does oil equate to power in the Middle East? This part of the globe
supplies most of the world with this valuable non-renewable energy
(oil). The more oil you have, the more power, and stronger economy
you have.
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32Sweden, Finland, and France are all in the European Union. How is Sweden
different from Finland and France? Sweden has a mixed economy – a free
enterprise system mixed with strong socialist systems. This ensures
economic security and healthcare. They do not use the euro.
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Mexico
Peru
Bolivia
Haiti
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