Mexico and
The Factors of Production
Grade 6
©2012, TESCCC
©2012, TESCCC
©2012, TESCCC
Key Understanding
Interaction between a country’s government, its economic system, and the factors of production often determines the level of economic development in a country.
Let us explore Mexico’s level of economic development.
First, we need to understand the factors of production.
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Mexico’s Government
• Three branches of government: Executive, Legislative and Judicial
• President is elected for only one term (serves a total of 6 years and may not serve again)
• Two political party system• Unfortunately, corruption within the
government decreases the number of outside investors.
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Mexico’s Economy
• Mexico has increased (printed more) money supply creating inflation and a devalue of their money.
• Lack of economic freedom (freedom to compete and protection of people)
• Corruption keeps the economy from growing because foreign investors are fearful of the instability.
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Industries of Mexico
• Manufacturing industries may take raw materials, buy materials from wholesalers, or buy materials from a retailer to make new products. – manufacturing in Mexico (Examples: clothing, toys, cars, houses, etc.
• Service industries provide intangible goods directly to the public, not final products – maquiladoras in Mexico (they provide labor, but companies are not Mexican), tourism as one of biggest industries after oil production.
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What determines the level of economic development for a country?
• Life Expectancy: the average number of years remaining in the life span of a person. (In Mexico– 76)
• Gross Domestic Product: a measure of the economy; the total market value of goods and services produced within a country per year. (In Mexico– 1.1 trillion)
• Gross Domestic Product per capita: this indicates the people’s standard of living; it is the country’s GDP divided by the number of people in the country. (In Mexico– $14,700)
• Literacy: the ability to read and write (In Mexico
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Mexico
Factors of Production
Defined: Inputs used in the production of goods and services
Examples
Land
Labor Capital: $$
Entrepreneurs(People willing to
invest)
Mexico’s Economic
System: Free Enterprise/Free
Market Economy
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The Factors of Production
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Land
• Natural resources• Characteristics
– A gift of nature– Limited in supply– Land is immovable– The supply of land involves no opportunity
cost
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Capital
• Man-made resources used for further production
• Examples: machines, raw materials, tools• Features:
– Man made
– It raises the productivity of other factors
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Is it LAND or CAPTIAL?
• Ice at Mount Everest• Ice in a skiing field• Sea water• Sea water in a seafood restaurant • Sharks in the Atlantic Ocean• Sharks at the Ocean Park
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Labor
• Any effort a person devotes to a task for which that person is paid.
• manual laborers, lawyers, doctors, teachers, waiters
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Entrepreneurship
• Ambitious leaders that combine the other factors of production to create goods and services.
• Examples-Henry Ford, Bill Gates, Inventors, Store Owners, etc.
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Free Enterprise Economy
• In a free enterprise economy, competition is allowed to flourish with a minimum of government interference.
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Four Characteristics of Free Enterprise
• 1. Economic FreedomPeople have the freedom to choose their occupation and their employer.
• 2. Voluntary Exchange The act of buyers and sellers freely and willingly engaging in market transactions.
• 3. Private Property
People have the right and privilege to control their possessions as they wish.
• 4. Profit Motive
People are free to risk their wealth in a business venture.
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What stories do murals tell?
• Muralists Diego Rivera, Jose Clemente Orozco, and David Alfaro Siqueiros were important artists in 20th century.
• The mural tradition continues today, as shown in the mural we saw painted on the fence.
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Artist Hector Duarte, who lives in Chicago, has turned his home into a giant mural representing the struggles of a Mexican immigrant
This is a ________________ that illustrates __________________________________.
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Corn
• Corn was first domesticated in Mexico about 8,700 years ago, around 6700 BC
• The story of corn is the story of Mexico.
• Public art in Mexico has a long history, predating European exploration
• Murals are one medium used to communicate with the people.
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