ECONOMICS CHAPTER 2 LESSON 3 NOTES
AUGUST 7, 2013
BELL RINGER
CREATE A BULLET LIST OF WHY YOU THINK THE
ECONOMIC SYSTEMS IN THE WORLD TODAY ARE TO
SOME DEGREE A MIXTURE OF ALL THREE SYSTEMS.
STANDARDS: 2.3 understand the different major
economic systems.
TERMS: MIXED ECONOMY, CONTINUUM,
TRANSITIONAL ECONOMY
OBJECTIVES: STUDENTS WILL SEE HOW THE
MODELS OF ECONOMIC SYSTEMS DEVELOPED
AND HOW THEY ACTUALLY WORK IN THE REAL
WORLD. MOST SYSTEMS ARE MIXED BECAUSE
THEY CONTAIN ELEMENTS OF MORE THAN ONE
ECONOMIC SYSTEM.
REVIEW:
1. WHAT ARE THE THREE ECONOMIC
QUESTIONS THAT ALL ECONOMIES MUST
ANSWER WHEN IT COMES TO THE
PRODUCTION OF GOODS AND SERVICES?
2. WHAT ARE THE THREE ECONOMIC SYSTEMS
FOUND IN THE WORLD TODAY?
3. WHAT ARE THE CHARACTERISTICS OF EACH
SYSTEM?
A. TRADITIONAL ECONOMY
B. COMMAND ECONOMY
C. MARKET ECONOMY
NOTES:
A. ECONOMIC SYSTEMS IN THE REAL WORLD
1. NO COUNTRY HAS A PURE TRADITIONAL,
COMMAND OR MARKET ECONOMY.
2. TO SOME DEGREE, EVERY ECONOMIC
SYSTEM TODAY IS A MIXED ECONOMY.
3. ECONOMISTS PLOT THE RANGE OF
DIFFERENT COUNTRIES AS TO THEIR
PLACE BETWEEN A PURE COMMAND AND
PURE MARKET ECONOMY. THIS LINE IS
CALLED A CONTINUUM.
B. CHANGING ECONOMIES
1. ECONOMIES CHANGES AND THEY ARE
NEVER FIXED.
2. 1980’S CHINA WAS CLOSE TO A PURE
COMMAND ECONOMY BUT TODAY, CHINA
HAS ENCOURAGED ELEMENTS OF A
MARKET ECONOMY. “QUESTION ON
CONTINUUM” NAME SOME ELEMENTS IN
CHINA’S ECONOMY THAT REPRESENTS A
MARKET ECONONY.
3. ECONOMIES THAT ARE MOVING ARE
CALLED TRANSITIONAL ECONOMIES.
CHAPTER REVIEW
A ____economic system_________________ IS THE
WAY A NATION OR SOCIETY USES LIMITED
RESOURCES TO SATISFY IS PEOPLE’S
UNLIMITED WANTS AND NEEDS.
PRODUCERS SEEK THE MOST
__efficient____________ METHOD OF PRODUCTION.
IN A _____traditional economy________________,
EACH GENERATION ANSWERS THE BASIC
ECONOMIC QUESTION IN THE SAME WAYS THAT
GENERATIONS BEFORE DID.
TRADITIONAL ECONOMIES ARE__stable_________
BUT PROVIDE NO INCENTATIVES TO TRY NEW
IDEAS.
IN A ____command economy_________________, A
CENTRAL AUTHORITY OR GOVERNMENT
PROVIDES THE ANSWERS TO THE BASIC
ECONOMIC QUESTIONS.
IN A __market economy__________________, THE
PEOPLE PROVIDE ANSWERS TO THE THREE
BASIC QUESITONS OF ECONOMICS.
A __mixed economy___________________ CONTAINS
ELEMENTS OF TRADITIONAL, COMMAND AND
MARKET ECONOMICS. MOST ECONOMIES CAN
BE PLACED ON A _comtinuum_________________
BETWEEN COMMAND AND MARKET
ECONOMIES.
ECONOMIES THAT ARE CHANGING ARE KNOWN
AS ___transitional
economy_________________________.