Traditional EconomyTraditional Economies, found in rural regions, practice subsistence farming

COMMAND ECONOMY

1.Command –Communist An economy in which the government owns almost all the land and natural resources and makes most of the economic decisions.Ex.: North Korea, Cuba

INDUSTRY / BUSINESS

Retail - Consists of the sale of physical goods or merchandise from a fixed location.

Example: Target, Wal-mart, Old Navy, Supermarket

Industry

Agriculture – prepare and process raw materials (natural resources), such as timber, wheat, and iron ore.

example: farms, mining company, logging company

A company that supports or helps another business to sell products is considered a SERVICE BUSINESS

LIKE THE ELECTRIC COMPANY THE CABLE PROVIDER OR THE INTERNET

Wholesale – service industries, move goods (transporting) from the manufacturer to another business or to consumers example: Sam’s Club, McLane's Food Distribution, Kellogg's

If there were not enough workers to manufacture electronics the U.S.A. Would have a problem!

ELECTRONIC SHORTAGE

Scenario: Iran has stopped selling Oil.

The US is in short supply of gasoline

The price of gasoline will go up!

A Developed Economy

High GDP

High Life Expectancy

High Literacy Rate

People in developed economies have access to education and healthcare

Mr. Brown wants to start a new business; what does he need to consider when locating his new factory?

Available Literate (able to read) workers

Near needed resources

Transportation available

Texas has run out of cows!

What would the logical solution be if you were in the business of making leather boots?

Move your company to Montana where there are plenty of cows

The scarcity of resources causes countries to trade peacefully,

But!!!! It can lead to military conflictA country could deal with uneven resource distribution through economic interdependence and trade with other countries that do have the resources

Democratic countries usually have Market / Free enterprise economies

If the government chose which products that companies were allowed to produce the choice of products to buy would be limited.

Economic Systems

1. Command – An economy in which the government owns almost all the land and natural resources and makes most of the economic decisions. Exampe: Cuba & North KoraMarket / Free Enterprise – An

economy in which the people own and control businesses. Example: U.S. Japan

Traditional Economies, found in rural regions, practice subsistence farming

Wants & Needs

Wants( I WANT) i-POD60 inch TVNew TruckSwimming pool More shoes

Needs (requirements for living)FoodClothsShelter

People in Traditional Economies practice, subsistence farming and raise only enough food for themselves and their families

Traditional Economies are found in rural regions,