1. Warm-up 9/10 How does the economy impact your life? Answer in your binder!

2. What is Economics? Economics- production, distribution, and use of goods and services – The study of how people meet their needs

3. 3 Types of Economic Systems 1) Market 2) Command 3) Traditional

4. Market Economy Decisions made by individuals (what to make, sell and buy) supply and demand Based on trade and competition Also called free markets or capitalism Some government regulation (laws, taxes) USA, Great Britain, Canada, France, and Japan have a market economy

5. Command Economy Central government alone makes decisions – Also known as communism No incentive to work harder Dictates lives of individual workers Manages all elements of production China, Cuba, Vietnam, and North Korea are the world’s major communist countries

6. Mixed In a mixed economy, business owners make decisions but there is strong government regulation

7. Traditional Economy based on agriculture Most families in a traditional economy only grow enough for themselves Traditional economies are usually poor. The people concentrate on survival, not making money Usually found in 3 rd world countries Bangladesh and Ivory Coast still have traditional economies

8. GNP GNP (Gross National Product)- The value of all goods and services a country produces in one year RankCountry/RegionGNP (US $) World 72,689,734,000,000 1 United States 16,244,600,000,000 2 China 8,358,400,000,000 3 Japan 5,960,180,000,000 4 Germany 3,425,956,000,000 5 France 2,611,221,000,000 6 United Kingdom 2,471,600,000,000 7 Brazil 2,254,109,000,000 8 Russia 2,029,812,000,000 9 Italy 2,013,392,000,000 10 India 1,875,213,000,000

9. GDP GDP (Gross Domestic Product)- How much each individual produces within a year GNP divided by the population = GDP RankCountryUS $ 1 Qatar 98,814 2 Luxembourg 78,670 3 Singapore 64,584 4 Norway 54,947 5 Brunei 53,431 6 United States 53,101 — Hong Kong 52,722 7 Switzerland 46,430 8 San Marino [6][7]San Marino [6][7] 44,480 9 Canada 43,472 10 Australia 43,073

10. Supply and Demand We use Supply and Demand to determine how much goods will cost The more of something you have, the less valuable it becomes

11. Cultural Diffusion The spread of cultural characteristics – Foods, music, clothing, ideas, technology

12. Think! How can the presence or absence of natural resources and arable land affect a nation’s economy, regardless of the type of economic system?