Economy in the world

Definition of Economy

•Economy-The way that goods services are produced & distributed

Buying and Selling• Producers- People who

provide services & make goods people buy

• Consumers- People who buy goods or use services

• Economy is the all activities of producers and consumers

• Opportunity Cost- The value of the item you didn’t buy

Economics System• Free enterprise system-

People can own & run own businesses– America runs on this system

• Command economies-Gov’t will decide what will be produced & the price

FREE ENTERPRISE

SYSTEMVS.

COMMAND ECONOMIES

Bell Work

•What type of economic system do we have?

Economics Systems• Free enterprise system– America runs on this system

– Entrepreneurs- People who run own businesses

– Profits- Money business makes after pays for cost of business

– Investments- Money that is put into a business to help it succeed

GDP• Gross Domestic Product (GDP)-

The cost of all goods & services added up in any country–U.S.A. in the trillions of dollars

Marketplaces• Supply and Demand

– Supply-The amount of any product or service available at any time.

– Demand- How much of a product or service people want to buy

• Low supply=high price

• High supply=low price

• Low demand=low price

• High demand=high price

Bell Work

•What does Supply and Demand mean?

Local Economy• Jobs and resources in the particular area

• Examples– Rural economy may be based on farming– Port economy may be based on fishing or

tourism

• Manufacturing economies- Based on making products

• Service economy- Based on providing services

• Local economies are a mixture

Global Economy• All countries need products and

services from other countries

• Interdependent- Independent, but also rely on others

• Exports- When one country sends its products to another country

• Imports- When a country buys goods & bring them across the border

• Trading expands the nations

Homework Assignment• I want you to think about 1 product

you have used either today or that you use each day.

• I want you to decide & write who would be the producer of that product.

• I also want you to decide/write who the intended consumer would be and why they would be the consumer.

• This needs to be a ½ page long explanation