EconomicsEconomics

Gorfien © 2009

EconomicsEconomics The study of how people The study of how people

make things to meet their make things to meet their needs and wants.needs and wants.

Gorfien © 2009

Limited ResourcesLimited ResourcesThere are not enough goods There are not enough goods to meet the demand.to meet the demand.

Gorfien © 2009

ScarcityScarcity The amount of resources The amount of resources can never satisfy human can never satisfy human wants and needs.wants and needs.

Needs

Wants

Resourcesfuel minerals

water wood

Gorfien © 2009

ProducerProducer A person or business that A person or business that supplies goods and supplies goods and services.services.

Gorfien © 2009

ConsumerConsumer People and businesses that People and businesses that use goods and services to use goods and services to satisfy their needs and satisfy their needs and wants.wants.

Gorfien © 2009

Types of Economic SystemsTypes of Economic Systems

Command Command Economic Economic SystemSystem

The government The government determines what determines what should be produced, should be produced, how it should be how it should be produced and who produced and who should get it.should get it.

Free Market Free Market EconomyEconomy

A type of economy A type of economy

where producers and where producers and consumers determine consumers determine what should be what should be produced, how it produced, how it should be produced should be produced and who should get it.and who should get it.

Gorfien © 2009

ProfitsProfits The difference between The difference between the producer’s costs and the producer’s costs and the selling price.the selling price.

Selling cost $520.00

Producer’s costs $400.00

Profit $120.00

Gorfien © 2009

AgricultureAgriculture Farms producing goods Farms producing goods such as apples, grapes and such as apples, grapes and dairy products.dairy products.

Gorfien © 2009

ExportExport To sell goods to a foreign To sell goods to a foreign country.country.

Gorfien © 2009

ImportImport To bring in goods from a To bring in goods from a foreign country.foreign country.

Gorfien © 2009

Global Global InterdependenceInterdependence

Countries depend on trade Countries depend on trade with other countries.with other countries.

Gorfien © 2009