Economies, Resources, Supply and Demand, balance of Trade

Economy Most of our time is spent trying to find the stuff we need to live—food, clothing, shelter. A group of people who make stuff they need to survive and divide it up is called an economy. People can be a part of several different economies at the same time—a family economy, a city economy, a national economy.

Resources Resource—something people use Natural resources—something from nature people use Nonrenewable resource—A resource that cannot be replaced. Example: Petroleum, Diamonds Renewable—A resource that can be replaced. This is NOT the same at RECYCLABLE. Example: Wind, Trees Distribution: how something is spread out. Uneven distribution of resources—places have different amounts and kinds of resources.

Economic Interdependence Definition—People and places cooperate with other people and places in order to get stuff. Economic Interdependence helps people have more stuff. One reason (but not the only) for economic interdependence is the uneven distribution of resources. Economic Interdependence forces people to trade.

Specialization/ Division of Labor People who do one job over and over again instead of making everything they need themselves. They do the job for money to then exchange for different stuff. Specialization means people get really good and really fast at one particular job Specialization increases economic interdependence.

Import/Export/Balance of Trade Import- stuff BOUGHT FROM another country Export- stuff SOLD TO another country Tariff- a tax on IMPORTS Balance of Trade- the difference between imports and exports in a country or between countries. The Balance of Trade can be negative or positive for a country. If a country sells more (exports) than it buys (imports), it has a positive balance of trade. If country buys more (imports) than it sells (exports), then it has a negative balance of trade.

Supply and Demand Supply- how much there is of something. Demand-how much people want the item THE RELATIONSHIP BETWEEN SUPPLY AND DEMAND HELPS DETERMIENS THE PRICE!!!!!!!!! If supply is low and the demand is low, the price is usually low If the supply is high and the demand is low, the price is very low If the supply is high and the demand is high, then the price is usually in the middle If the supply is low and the demand is high, then the price is high.

Gross Domestic Product A statistic is a number that gives important information about something. GDP is the total amount of all the stuff and work made by a country. GDP per capita means the total amount has been divided up by the number of people in the country. GDP per capita shows how wealthy or poor a country is. The US GDP per capita is $53,000 (memorize this NOW) The US is very wealthy.

Resources

Resource Think Sheet Answer the following questions— 1. What is a natural resource? 2. What does uneven distribution of resources result in (2 answers)? 3. How are resources affected when a population increases rapidly? 4. Is your answer to number 3 ALWAYS true? 5. How are resources affected when technology changes?

Economic Interdependence Think Sheet What is the main idea of the Starbucks graphic? Think of two ways you are economically interdependent. Do you think specialization increases or decreases economic interdependence? Why? How does economic interdependence affect cultural diffusion? What part of the Starbucks/McDonalds paper is an example of cultural diffusion?

Specialization/ Division of Labor Add to Resource/ Economic Interdependence Think Sheet— Think of an example of Division of Labor or Specialization in your life. What is something that happens because of division of labor? What helps stuff move around an economy when there is division of labor? Which would be more likely to have a noticeable division of labor? A. Hunter-gatherers B. Subsistence Farmers C. Industrialized Economy

Supply and Demand Think Sheet Think of a real life example of the following situations— A. Low supply, High demand B. High supply, low demand What is the relationship between supply and demand and uneven distribution of resources? What helps determine the price of something?

Import/ Export/ Balance of Trade Think Sheet Moldove needs goats and coffee. Moldove buys goats and coffee from Djibouti. They buy 50 million dollars worth of goats and 10 million dollars of coffee. Djibouti needs oil and dinner plates. They buy 15 million dollars worth of oil and 22 million dollars worth of dinner plates. What is Djibouti’s export? Who has the positive balance of trade? What is the difference?

Import/ Export/ Balance of Trade Think Sheet US trades $42.5 million in lumber to Japan for $15 million in professional wrestling equipment. What is Japan’s import? Who has the negative balance of trade? What is it? Oman trades $300 million in sand and $30 million in rare scorpions to Madagascar. Madagascar sells 1.2 million dollars worth of lemurs and $500,000 in lemur milk. What is Madagascar’s export? How much is it?