Chapter Two: Economic Systems & Decision Making

[Pages:11]Chapter Two: Economic Systems & Decision Making

Warm Up Question:

(write answer in notebook with today's date)

What are the Three Basic Questions of Economics?

Unit I: Basic Principles of Economics

? What do we call the place where buyers and sellers come together?

? This concept is a vital aspect to our economic system. It allows the free exchange of g&s and the producers and consumers have the power.

Unit I: Basic Principles of Economics

? ECONOMIC SYSTEM: an organized process to DECIDE how to use SCARCE RESOURCES to satisfy needs and wants.

? 3 Types of Economic Systems:

1. TRADITIONAL Economy:

2. COMMAND Economy:

What do each of these words

3. MARKET Economy:

mean to you? Brainstorm with

group

Move to a clean sheet in notebook: we need to make a table ECONOMIC SYSTEMS

heading MARKET COMMAND TRADITIONAL

Make it for the whole page; we will add in the rows as we go along together and then in groups!!

Unit I: Basic Principles of Economics

MARKET Command TRADEconomy Economy ITIONAL

Economy

WHO Consumers

answers the

&

3 BASIC

QUESTIONS?

Producers decide

Gov't

The past dictates,

Decides customs

decide

Unit I: Basic Principles of Economics

MARKET Command TRADEconomy Economy ITIONAL

Economy

WHERE do these

systems exist in the

world?

USA, Canada, Japan, most of Europe

Cuba, China,

Inuit (Eskimo), Aboriginal

N.Korea (Australia),

African &

Amish

Villages

Unit I: Basic Principles of Economics

MARKET Command TRADEconomy Economy ITIONAL

Economy

ADVANTAGES

DISADVANTAGES

Split Rest of

Table for 2 lastPAGE

rows

33

Traditional Economy

Advant ?Always KNOW ROLE in society ages ?STABLE and predictable life

?BASIC NEEDS provided

Disadvant ages

?LOWER STANDARD of living ?WANTS are not met ?NEW IDEAS discouraged ?LACK of progress, NO CHANGE

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