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Exploring Agribusiness in a
Free Enterprise System
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RST.6‐8.2 - Determine the central ideas or conclusions of a text; provide
an accurate summary of the text distinct from prior knowledge or
opinions. (MS‐LS1‐6)
WHST.6‐8.1 - Write arguments to support claims with clear reasons and
relevant evidence. (MSLS2‐4)
SL.8.1 - Engage effectively in a range of collaborative discussions
(one‐on‐one, in groups, and teacher‐led) with diverse partners on grade 8
topics, texts, and issues, building on others’ ideas and expressing their
own clearly. (MS‐LS2‐2)
SL.8.4 - Present claims and findings, emphasizing salient points in a
focused, coherent manner with relevant evidence, sound valid reasoning,
and well‐chosen details; use appropriate eye contact, adequate volume,
and clear pronunciation. (MS‐LS2‐2)
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Pathway Content Standard: The student will
demonstrate competence in the application of
principles and techniques for the development and
management of agribusiness systems.
 ABS.01. Performance Element: Utilize economic principles to
establish and manage an AFNR enterprise.
 ABS.01.01. Performance Indicator: Apply principles of
capitalism in the business environment.
 ABS.01.01.01.a. Recognize principles of capitalism as related to
AFNR businesses.
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Designer clothes, food, nike shoes, diamond
rings, your favorite music group’s compact
disc, notebook for ag class.
Make a list of your own wants and needs include the
above items.
We will discuss what items you consider to be needs
and what items you consider to be wants.
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Agricultural
economics
Allocates
Capitalism
Communism
Economics
Fascism
Free enterprise
Free resources
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Needs
Products
Resources
Scarcity
Services
Socialism
Subsidies
Wants
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The science that deals with the
production, distribution, and
consumption of wealth.
There are three different
components of economics:
Scarcity
2. types of resources
3. wants and needs.
1.
The situation where resources are
lacking.
 Economics studies the way
society allocates, or distributes,
its scarce resources.
 Not all resources are scarce, those
that are readily available are
called free resources.
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Shortage and scarcity are not the
same.
 Scarcity exists as a result of
limitations of a resource.
 A shortage is a temporary
situation.
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Resources are items ready to use at
any time.
Resources considered factors of
production include land, labor,
capital, and management.
These resources are used to make
products and provide services.
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Products are the goods produced
to meet the needs of customers.
Services are activities provided to
consumers for a fee.
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Needs are things needed for daily
living, food and shelter for example.
Wants are things that are not
necessary for daily living.
The differentiation between wants
and needs proves interesting, because
the more people get, the more they
want.
What goods should be produced
and how much of each?
 How should the goods be
produced?
 Who should get what?
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Traditional system, capitalism,
socialism, fascism, communism
and mixed economic system
The difference between each is
the level of control by individuals
versus by government.
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Is an economic system where
things are done according to how
they’ve been done in the past.
Decisions are based on beliefs
handed down for generations.
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An economic system where the
individual owns the resources and
can use their time and resources as
they want.
Government involvement is low, the
individuals must be self-regulating.
Private ownership allows for
competition.
Is an economic system where the
public has ownership of all
productive resources.
 In this system, the government is
responsible for making all of the
production decisions.
 The state establishes prices, thus
eliminating competition.
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Individuals own the resources but
produce goods as directed by the
government.
Individuals who support the
government have more economic
power than those who do not.
This allows the government to have
complete control over nearly all
aspects of business.
Is an economic system where one
party controls all means of
production.
 Private individuals have no
control over resources.
 The government exercises
complete control of the economy.
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Characteristics of the free enterprise
system.
1. little or no government control
2. freedom of enterprise
3. Freedom of choice
4. the right to own property,
5. profit incentive
6. chance for competition.
Government’s role in a free
enterprise system is to regulate
and protect the public while
keeping the economy in balance.
 Individuals own and have
choices over their resources, but
must do so within the limits of
the law.
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Free enterprise refers to an
individual’s freedom to own and
control production of resources.
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Americans have freedom of choice within the
U.S. economic system.
Freedom of choice means freedom to make
decisions about what should be produced.
However, government has set safety standards
meant to protect consumers.
The government also regulates utilities.
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Americans have the right to own
private property including land,
automobiles, and more.
There is no limit on how much you
can own outside your own budget
limitations.
Profits you make as a result of your
private property are yours to keep
after reasonable taxation.
Profit incentive is the ability to
make a profit from the private
property you own.
 Profit drives people to produce
more products for others to buy.
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Competition is a rivalry for a business’s
customers or markets.
Businesses survive based on their ability
to produce products competitively.
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Ag econ is the application of
economic principles to agricultural
problems.
The main emphasis of agricultural
economics is farm production. However,
it includes the entire agricultural
industry.
 Agricultural economics includes
agricultural finance, rural development,
and agricultural policy.
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What are the three major components
of economics.
Name and describe the six types of
economic systems.
List the characteristics of the
American economy.
Agricultural economics includes the
study of what three things