Economic System The way people produce and exchange goods and services.

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Transcript of Economic System The way people produce and exchange goods and services.

Page 1: Economic System The way people produce and exchange goods and services.
Page 2: Economic System The way people produce and exchange goods and services.

Economic SystemEconomic SystemThe way people produce and exchange goods and services

Page 3: Economic System The way people produce and exchange goods and services.

The Four Types of Economic Systems

• Four very different types of Economic Systems have evolved as different societies have placed different emphasis on different goals and priorities in their efforts to answer the Three Key Economic Question.

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Traditional Economy• Family or Community

based Economic System that relies on custom and ritual to make its choices.

• Examples:– Aborigines– Amazon Tribes– Any Subsistance

Economy

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Market Economy• Individual or Consumer

based Economic System that relies on the consumption choices of consumers. 

• Examples:– *The U.S.A.?– *Japan?– Any Capitalist Economy?

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Command Economy• Centrally Controlled

Economy where the Government makes all decisions.

• Examples:– Cuba– China?

– Any Communist Country or Dictatorship

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Socialist (Mixed) Economy

• Economic System that incorporates some Governmental involvement into a Market Based Economy.

• Examples:– *The U.S.A.?– *Japan?– *China?– Most “Modern” Economies

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Types of Economic SystemsTypes of Economic Systems

Free Market Command TraditionalSocialist

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Types of Economic SystemsTypes of Economic Systems

Free Market Command Traditional

People freely produce and buy what they want

Prices are set buy Supply and

Demand

Producers invest their money to make a Profit

Little Government interference

Free Enterprise,Capitalism

Market Economy

Socialist

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Types of Economic SystemsTypes of Economic Systems

Free Market Command Traditional

People freely produce and buy what they want

Prices are set buy Supply and

Demand

Producers invest their money to make a Profit

Little Government interference

Free Enterprise,Capitalism

Market Economy

Socialist

Government makes all economic decisions

Workers are supposed to share equally

No private property

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Types of Economic SystemsTypes of Economic Systems

Free Market Command Traditional

People freely produce and buy what they want

Prices are set buy Supply and

Demand

Producers invest their money to make a Profit

Little Government interference

Free Enterprise,Capitalism

Market Economy

Government provides free or low-cost public

services: school, health care, etc.

Government owns some

basic industries

Government makes all economic decisions

Workers are supposed to share equally

No private property

Socialist

Page 12: Economic System The way people produce and exchange goods and services.

Types of Economic SystemsTypes of Economic Systems

Free Market Socialist Command Traditional

People freely produce and buy what they want

Prices are set buy Supply and

Demand

Producers invest their money to make a Profit

Little Government interference

Free Enterprise,Capitalism

Market Economy

Government provides free or low-cost public

services: school, health care, etc.

Government owns some

basic industries

Government makes all economic decisions

Workers are supposed to share equally

No private property

People work to meet their basic

needs

Subsistence Agriculture:

Farmers grow enough to feed their families

Cottage Industry: Goods are produced in private homes

by hand

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Economic ActivitiesEconomic ActivitiesPrimary – Gathering raw materials

Secondary – Adding value to materials by changing their form.

Tertiary – Business or professional services

Quaternary – Providing information, management or research services

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Natural ResourcesNatural ResourcesRenewable – Can be replaced by natural processesExamples: trees, seafood,

Non-renewable – Cannot be replaced once usedExamples: coal, petrolium, natural gas

Inexhaustable – Unlimited supplyExamples: sunlight, wind, geothermal heat

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Social Networking Website to Exchange Goods

Social Networking Website to Exchange Goods

THEY HAVE ISSUES: DO PUBLIC GOODS PRODUCE · PDF file1 THEY HAVE ISSUES: DO PUBLIC GOODS PRODUCE PUBLIC SUPPORT IN CHINA? PERFORMANCE LEGITIMACY AND POPULAR SUPPORT IN CHINA1 Bruce

THEY HAVE ISSUES: DO PUBLIC GOODS PRODUCE · PDF file1 THEY HAVE ISSUES: DO PUBLIC GOODS PRODUCE PUBLIC SUPPORT IN CHINA? PERFORMANCE LEGITIMACY AND POPULAR SUPPORT IN CHINA1 Bruce

The Nontradable Goods’ Real Exchange Rate Puzzle

The Nontradable Goods’ Real Exchange Rate Puzzle

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.

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.

Accounting for Real Exchange Rates Using Micro-Data · thus the real exchange rate of traded goods is constant over time, leaving the real exchange rate of non-traded goods to account

Accounting for Real Exchange Rates Using Micro-Data · thus the real exchange rate of traded goods is constant over time, leaving the real exchange rate of non-traded goods to account

The Columbian Exchange. What is the Columbian Exchange? The massive exchange of agricultural goods, slave labor, communicable diseases, and ideas between.

The Columbian Exchange. What is the Columbian Exchange? The massive exchange of agricultural goods, slave labor, communicable diseases, and ideas between.

Resources Are factors of production employed to … Are factors of production employed to produce goods ... o Is an area in which people make, or produce, goods and services ... for

Resources Are factors of production employed to … Are factors of production employed to produce goods ... o Is an area in which people make, or produce, goods and services ... for

Tradability of Goods and Real Exchange Rate Fluctuationsusers.econ.umn.edu/~tkehoe/papers/caroline.pdf · Tradability of Goods and Real Exchange Rate Fluctuations Caroline M. Betts*

Tradability of Goods and Real Exchange Rate Fluctuationsusers.econ.umn.edu/~tkehoe/papers/caroline.pdf · Tradability of Goods and Real Exchange Rate Fluctuations Caroline M. Betts*

Flowers • Produce • Baked Goods • Cheeses • Crafts Glen Ellyn

Flowers • Produce • Baked Goods • Cheeses • Crafts Glen Ellyn

Can developing countries produce their own equipment goods

Can developing countries produce their own equipment goods

An internet based common household goods exchange program ... · An internet based common household goods exchange program Free to Ocean County residents Dear Citizen, Recycling continues

An internet based common household goods exchange program ... · An internet based common household goods exchange program Free to Ocean County residents Dear Citizen, Recycling continues

Evolution through dis-integration How the future of the …...out the same transaction by means of an exchange in the market. Thus, business units that produce goods or services that

Evolution through dis-integration How the future of the …...out the same transaction by means of an exchange in the market. Thus, business units that produce goods or services that

1. Resources People, goods, capital, and materials necessary to produce products or provide a service. People, goods, capital, and materials necessary.

1. Resources People, goods, capital, and materials necessary to produce products or provide a service. People, goods, capital, and materials necessary.

Roaring Twenties. Mass Production After World War I ended factories began to produce more to consumer goods. Consumer goods are: Goods, such as food and.

Roaring Twenties. Mass Production After World War I ended factories began to produce more to consumer goods. Consumer goods are: Goods, such as food and.

Factors of Production. HOW ARE GOODS PRODUCED? Factors of production The productive resources used to produce goods and services. Factors of production.

Factors of Production. HOW ARE GOODS PRODUCED? Factors of production The productive resources used to produce goods and services. Factors of production.

Bills of Exchange & Goods on Approval or Return Basis -Practice Problems

Bills of Exchange & Goods on Approval or Return Basis -Practice Problems

Factors of production : resources of land , labor , capital & entrepreneurship used to produce goods/services

Factors of production : resources of land , labor , capital & entrepreneurship used to produce goods/services

Ecosystem Goods and Services: Where are We? · Ecosystem Goods • Ecosystem services, while generally unnoticed by humans, produce a range of ‘goods’ that are tangible, material

Ecosystem Goods and Services: Where are We? · Ecosystem Goods • Ecosystem services, while generally unnoticed by humans, produce a range of ‘goods’ that are tangible, material

Businesses can borrow savings to: Businesses can borrow savings to: produce new goods and services produce new goods and services build new plants and.

Businesses can borrow savings to: Businesses can borrow savings to: produce new goods and services produce new goods and services build new plants and.

Unit 4. Economic Geography Economy-consists of the production and exchange of goods and services. Economic system-is the way people produce and exchange.

Unit 4. Economic Geography Economy-consists of the production and exchange of goods and services. Economic system-is the way people produce and exchange.