And have out
your wkst on
Supply and
Demand to be
checked
Warm-up- Honors
Journal Activity
1. What are the 4 factors of
production used to make goods
and services?
2. How does the interaction of
supply and demand determine
the price of a good or service?
Check Homework
have
out
your
wkst to
be
graded
Economic Systems Objectives
Content
Describe 4 different types of
economies and determine which
type the US has.
Language
•
Students will understand the
content through learning new
vocabulary reading and notes to
successfully complete an exit
ticket.
New Vocabulary
Lesson #3
Page 204
Market
• Place where goods and services are bought and sold
PROFIT
• Money businesses receive for its product or
service after their cost
Traditional Economy
Economic system where the decisions of what, how and
for whom to produce are based on customs or habit
Command Economy
Type of economic system where major economic
decisions are made by the government
Free (market) Economy
Economic System in which individuals and businesses are
allowed to compete for profit with little government
involvement
Mixed Economy
Economic system combining characteristics of more
than one type of economy
Competition
Struggle between buyers and sellers to get the best
products at the lowest prices
Private Property Rights
Freedom to own and use property as long as it does not
interfere with the rights of others
Consumer sovereignty
Role of the consumer as the ruler of the marketplace
determining what products will be produced
Lesson 3- Economic Systems
[page 217]
Essential Questions
1. Describe the 4 types of economic systems.
2. Identify which system the US has and why.
Economic systems is about how a country decides
to use its limited productive resources by answering
the 3 basic questions…decide the ownership of
resources…
…and structure markets for
the distribution of goods and
services.
Notes
1.
Every country needs to answer the 3 basic questions
about their economy-



What to produce?
How to produce?
For whom to produce?
2. How will a country decide?
 based on its limited productive resources
 how much government involvement
 try not to rely on just their own markets to deal
with scarcity
History of Economic Systems
?- current
1800’s
Capitalism
Traditional
Economies
Big Business
Owners
1700’s
1700-current
Mixed
Economy
1800’s
Free (Market)
Command
Economy
Economy
(gov’t rules)
TRADITIONAL
ECONOMY
 Based on customs and traditions
 People perform the same work
as their ancestors regardless of
potential or ability
Who owns the Factors Who makes the
of Production?
decisions in the
marketplace?
people but there are
few resources
available
people
Countries that use
this system today.
poorer, developing
countries
Examples
Free Market Economy
 Can own private property and
resources to earn profits
 Competition encouraged
 Individuals make the
choices= Consumer sovereignty
 No gov’t involvement*****
Who owns the Factors Who makes the
of Production?
decisions in the
marketplace?
people – business
owners
people- consumers
Countries that use
this system today.
no one
Examples
COMMAND
ECONOMY
 Centrally planned economy by
the gov’t
 Property and resources owned by
the gov’t
 Lack of consumer choice
•
Who owns the Factors Who makes the
of Production?
decisions in the
marketplace?
govt
govt
Countries that use
this system today.
communist
nations
Examples
“Communism”
MIXED ECONOMY
 private sector- People make decisions
(free market)
 public sector-Gov’t owns some
resources and makes decisions
(command economy)
 Govt role is greater than in free
market but less than in command
economy
Who owns the Factors Who makes the
of Production?
decisions in the
marketplace?
People & govt
People & govt
Countries that use
this system today.
Most countries
today
Examples
CHARACTERISTICS OF THE U.S ECONOMY
Notes
FREE MARKETS-
•
Little gov’t involvement
•
interaction of supply and demand determines prices
Notes
CONSUMER SOVEREIGNTY-
•
consumer choices rule the market
Notes
COMPETITON-
•
rivalry between sellers of a good or service
• results in better quality goods at lower prices
Notes
PRIVATE PROPERTY RIGHTSpeople can own property and its factors of production
Notes
PROFITIndividuals and businesses keep all earnings
Vocabulary Check- (practice)
• Get out your journal
Conclusion
1.
2.
Write a 2-3 sentence summary
3.
Get ready for the Economic Quiz #1 NOW.
Homework- read and highlight pages 208-209 “Lesson
3- Economic Systems” and answer questions 4-8.
Reading [page 208-209]
• Reading page 161
STORY TIME!
•
•
What type of economic system is
used in this story?
What characteristics of the
marketplace that helped to make
your decision?
Click the mouse button or press the
Space Bar to display the answer.
TRADITIONAL
ECONOMIES
• Decision making
based on customs
and traditions
FREE MARKET
ECONOMIES
• decision making by
individuals and
businesses
COMMAND
ECONOMIES
• Central planning by
the government
MIXED
ECONOMIES
• Central
planning
and
individual
decision
making