1. TALK BACK! I’m going to ask for it back!!!!

2. Centrally Planned Economy Centrally Planned Economies Oppose … –Private property. –Free market pricing. –Competition. –Consumer choice. How are these things listed different in a Free market economy? –The central government answers the Three economic questions. How is this different than a Market Economy?

3. Socialism – (Pres. Accused?) –the belief that wealth should be evenly distributed throughout society. –Real equality can only exist when political equality is coupled with economic equality. –Economic equality is only possible if the public controls the centers of economic power. –How is this different than the Free market? –What are some of the potential problems of socialism?

4. Communism – all political and economic power rest in the hands of a central government. –The central government answers the three economic questions. –Communist countries are usually autocratic / authoritarian. –Democracy does not exist. CORRELATE – –Exercise – Quickly read the pages 38 & 39.

5. Exercise – “If it’s in blue I may ask you!!!!!!!!!!” –Quickly read the pages 38 & 39. What key terms under the Free Market Economy are absent in the Centrally Planned Economy? –Self-interest –Competition –incentive –Invisible hand –Consumer sovereignty

6. Exercise – “If it’s in blue I may ask you!!!!!!!!!!” –Quickly read the pages 38 & 39. What key terms from chapter one section one are absent. Why? –wants –entrepreneur What key terms from chapter one section one are present. Why? –All terms in section 2 –All terms in section 3 –All but two terms in section 1

7. MIXED ECONOMIES How do goods, services, needs, wants, self-interests, safety nets, guns & butter, human capital, etc. create a need for a mixed economy? Do you agree with Adam Smith’s Laissez-faire philosophy? Why or why not?

8. In a Mixed Economy… –Government provides services that an entrepreneur normally would not consider providing. An Army Welfare Education for all. Public services. Police protection –Government helps to regulate the practices of businesses to protect the consumers.

9. In a Mixed Economy.. –Needs that markets could meet fall to government so that all members of society can participate. –government creates laws protecting property rights and patent laws giving people the incentive to develop new products. –Government create laws to promote competition preventing monopolies.

10. In a Mixed Economy… – some economic goals are better met by government action. Mixed economies are characterized by Free enterprise – an economic system characterized by private or corporate ownership of capital goods. A Continuum is a range of economies with no clear divisions. –Government control can range from total control to very little control.

11. Labor & human capital Goods & services Factor payments Wages. Money flow Money flows back into the factory FACTOR MARKET PRODUCT MARKET

12. Labor & human capital Goods & services Factor payments Wages. Money flow Money flows back into the factory FACTOR MARKET PRODUCT MARKET Government Goods & serv