Economics 101 Economics b Economics is what keeps

Economics 101

Economics b Economics is what keeps a nation on its feet. It determines whether or not a nation’s people are educated, well-paid, fed, healthy, and living a good life.

Asks 3 Main Questions b What goods and services should be produced? b How should the goods be produced? b For whom should the goods be produced?

4 Main Types v Traditional v Market v Command v Mixed

Homesteader b You are moving out west looking for a place to move your family. b Draw a home on your map

4 Sectors of the Economy b. Primary Sector- extracts or harvests products from the earth b Other examples- agriculture, mining, forestry, farming, grazing, hunting and gathering, fishing, and quarrying b Agriculture- two types • Subsistence- growing enough for your family • Commercial- growing enough to sell

You need to provide for family… b So you decide to become a farmer b Draw a rectangle near your home showing crops b Label it subsistence agriculture

Traditional Economies Each person in a society has a certain activity or job to do Based on customs

Traditional Economy Usually found in developing countries with increasing populations

Traditional Economy

Population Increases… b As more and more people move from the east, people start moving near you b Add 5 more homes for new families

Discover Coal Deposits b Two of the families discover a huge coal deposit near the mountains. b They decide to open factories to make things. b Two other families decide to sell crops

4 Sectors of the Economy b. Secondary Sector- manufactures finished goods b Other examples- metal working and smelting, automobile production, textile production, chemical and engineering industries, aerospace manufacturing, energy utilities, engineering, breweries and bottlers, construction, and shipbuilding.

Market Economy an economy in which the prices of goods and services are determined in a free price system.

Capitalism b In a capitalist or freemarket economy, people own their own businesses and property and must buy services for private use, such as healthcare.

Urbanization b b b The factories and commercial farms lead to more people moving closer together near the stores Draw some downtown buildings and hotels near the factories Draw some extra transportation routes (train / harbors for ships / roads

Leads to a need for government b b Choose a type of government Create a town name, a county name, and a state name

Command Economy North Korea Kim Jung Un

Cuba

Communism b In a communist country, the government owns all businesses and farms and provides its people's healthcare, education and welfare.

4 Sectors of the Economy b. Tertiary Sector- the service industry; provides services to the general population and to businesses b Other examples- include retail and wholesales, transportation and distribution, entertainment (movies, television, radio, music, theater, etc. ), restaurants, clerical services, media, tourism, insurance, banking, healthcare, and law.

Service Industries b b As more people move closer to togethere is a need to provide services for them. Draw a school, a hospital, theater, bank, police station, stores, and transportation center

4 Sectors of the Economy b. Quaternary Sector- consists of intellectual activities (Mind) b Other examples- includes government, culture, libraries, scientific research, education, and information technology.

Intellectual thinking… b b To help keep the people flourishing to need to stimulate the mind. Draw an art museum, library, and technology center.

Share your picture with someone b Answer these questions • What did you like about theirs? • What would you change about yours? • How much does planning help in developing places to live?

The Dawn of an Economy b First, either private companies or the government builds factories to produce goods. b The government builds schools, transportation, and health care facilities.

Education b Adults use the schools to learn how to run the new factories. b Children also go to school, but they are not trained for work until they are adults.

Workers The newly-trained adults take up jobs at the new factories. b The factory benefits from the workers making goods for them. b The workers also benefit from the factories, who pay them wages. b

Spending b b The workers, who get paid by the factories, use the money to buy food, clothes, furniture and other accessories for their families. The factories and businesses selling these goods receive money from the consumers.

Tax Day b Both workers and factories have to pay taxes to the government. b The government uses these taxes to pay for the schools, transportation, and medical facilities.

The loop goes on After taxes pay the public services, more people are educated for work, more factories are built, and the new workers run the new factories. b The Economics cycle simply loops; it will never stop… or will it? b

Uh-oh…. b When the tour mentioned “it will not stop, ” it means that it will continue to grow stronger, as long as everything that we mentioned happens. But, an economy is set up like a Domino line, and knocking down that one brick knocks them all down. . .

The end is near…. . Let’s pretend that all of the factories started making goofy products that no one likes. That means that no one will buy the products.

Well, if no one buys anything, the factories don’t make any money, and will have to fire some of their workers.

If the people can’t work, they will have no money to buy products or pay taxes.

Now the government can’t make any money, making it impossible to keep the public services.

Without public services, people can’t get educated, drive on the streets, or go to the doctor when they are ill or injured.

It is now impossible for factories to recruit workers to make their products. The factories close, and the last brick of the economy is down.

Wrap-up In conclusion, an economy is one of the hardest things to run. It is most difficult to start one, or improve a terrible one. You need money and education to make factories, but money comes from factories.

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