Name:
Marketing: Chapter 3 – Political and Economic Analysis
Date:
Economy - the __________ way a nation provides for its people
Economic Resources - all things used in producing goods and services (economists call this __________
of Production)
 Land - includes everything contained in the ______ or sea (coal, trees, fish, wheat)
 Labor - refers to all ______ who work
 Capital - includes all money, _________, computers and tools needed in a business
 ___________________ - skills of people who are willing to invest their time and money to run a
business
traditional economy - An economic system in which habits, ___________, and rituals answer
the basic questions of what, how, and for whom.
What?
How?
Whom?
command economy - A system in which a country’s ______________ makes all economic decisions
regarding what, how, and for whom.
What?
How?
Whom?
market economy - An economic system in which there is ___ government involvement in economic
decisions.
What?
How?
Whom?
Mixed Economy
 every economy has influences that make it at least somewhat ________
 the United States has primarily a __________economy, but what are some examples of
command and traditional economies?
Political and Economic Philosophies
Capitalism:
Characteristics:
Examples:
Communism:
Characteristics:
Examples:
Socialism:
Characteristics:
Examples:
Economies in Transition
Privatization - process of governments _______ government-owned businesses to private individuals or
business (_________, Great Britain, Russia - Mikhail Prokhorov)
Nationalization - the government __________ a privately-held company (______, Venezuela)
Goals for a Healthy Economy:
Increased ____________; Decrease Unemployment; Maintain Stable _________
Economic Measurements:
Productivity - output ______________ hour that measure over a period of time
How can businesses increase its productivity?
(Invest in new _____________; training; financial incentives - FED EX)
Gross domestic product (_____) - output of goods and services produced by labor and property located
within a country
Gross national product (_____) - total dollar value of goods and services produced by a nation, including
goods an services produced _________by U.S. citizens and companies
If you buy a Toyota Sienna manufactured in Gibson Co., would it be included in GNP?_______
If you buy a Nike shoe manufacturer in Vietnam, would it be included in GNP? _______
Standard of Living - ____________________of the amount and quality of goods and services that a
nation's people have
 GDP / Population
 High levels of __________________ (education) and durable goods (washing machine) mean that
a country has a high standard of living
Inflation Rate - refers to ______prices
 A low inflation rate (______%) is good because it shows the economy is stable
 When inflation is high - money ______value
Consumer Price Index (CPI) - measures the changes in price over a period of time of ____ specific retail
goods and services used by average ________________
Producer Price Index (PPI) - measures _____________ price levels in the economy
Unemployment Rate - jobless rate
 the lower the unemployment rate, the greater the chances are of an economic _____________
Business cycle - ___________ changes in economic activity.
 Expansion - A time when the economy is _____________.
 Recession - A period of economic ______________that lasts for at least two quarters, or six
months.
 Recovery - The term that signifies a period of renewed economic _________ following a
recession or depression
 ___________ - A period of prolonged recession.
How do the following influence the business cycle?
Business:
Consumers:
Government:
How can business, consumers, and government affect the business cycle?