R48 - Human-Made Trade Barriers Tariff - a ____________ on Imported Goods Why would a country put a tariff or quota in place? Quota- A ___________________ on the amount of goods that can be imported from another country. Embargo A total ________________ on trade with a country *Usually motivated by politics to hurt another country economically.

What you need at your desk: Social Studies Portfolio Writing Utensil (Not a Red Pen) Leave Everything Else in Your Backpacks

Re-Test #1 Due Thursday (1/29) Reminder: Re-Test #1 Due Thursday (1/29)

What is Scarcity? The idea that there are not enough resources to meet everyone’s needs & wants.

How do you solve the problem of scarcity?

Economics is the study of how people manage their resources. What is Economics?????? Economics is the study of how people manage their resources.

Return to our……. “Essential Question(s)” What types of economic systems exist in the world today?

These questions must be answered: What will we produce? How will we produce it? 3. Who gets it?

Even though a country may have answered those 3 questions, they still may not be able to meet all their needs/wants. Pick an item of clothing, shoes, etc. & find out where it is made on the tag

Why don’t we just produce all of our needs/wants for ourselves? Why do we trade? Why don’t we just produce all of our needs/wants for ourselves?

Voluntary “Free” Trade “Market” wherever goods/services are sold or consumed Foreign Markets Domestic Market Foreign Goods US Goods BENEFITS: US Producers can sell goods to more people around the world (bigger Marketplace = More $) More $ for US Producers means more jobs for US workers US Consumers have more products available to choose from US Consumers have more choices and possibly cheaper prices RISKS: Foreign Producers may have cheaper goods & could possibly run US Producers out of business If US Producers lose money or go out of business, that can mean less jobs for US workers

Why would a country purposefully hinder or slow/stop trade from happening?

(R48) Trade Barriers & N.A.F.T.A.

Today’s Standard(s) SS6E2 The student will give examples of how voluntary trade benefits buyers and sellers in Latin America and the Caribbean and Canada. b. Compare and contrast different types of trade barriers, such as tariffs, quotas, and embargos. c. Explain the functions of the North American Free Trade Agreement (NAFTA).

Intro to Our Essential Question…… How do trade barriers (tariffs, quotas, and embargos) hinder voluntary trade from occurring between countries? How does the North American Free Trade Agreement (NAFTA) impact Canada’s economy and trade?

R48 - Human-Made Trade Barriers Tariff - a Tax on Imported Goods Why would a country put a tariff or quota in place? To make foreign goods more expensive. Consumers will then likely choose to buy cheaper domestic goods Quota- A Limit on the amount of goods that can be imported from another country. Embargo A total Ban on trade with a country *Usually motivated by politics to hurt another country economically.

Trade Barriers Domestic Foreign Market Markets “Market” (Tariff – Quota – Embargo) “Market” wherever goods/services are sold or consumed Domestic Market Foreign Goods Foreign Markets “Protectionism” US Goods BENEFITS: US Producers do not have to worry as much about competition with foreign producers US Producers can charge more for their goods & services US Producers may be less likely to fire people if they make more $ RISKS: Foreign countries may respond with trade restrictions against US Producers US Producers may lose the foreign markets & will have less consumers to sell to = Less $ US Consumers will have less choices & will most likely pay more than they would w/ Free Trade

N.A.F.T.A. (North American Free Trade Agreement) Reduction of Trade barriers between Canada, Mexico, & USA (Tariffs, Quotas, etc.) Intended to increase trade of goods between the countries Feelings about the success of NAFTA are mixed

Turn to the Back of your R48

Intro to Our Essential Question…… How do trade barriers (tariffs, quotas, and embargos) hinder voluntary trade from occurring between countries? How does the North American Free Trade Agreement (NAFTA) impact Canada’s economy and trade?

Types of Economic Systems Traditional- customs & habits of a society will determine what will be produced & how it will be distributed & consumed (Usually includes bartering, rather than money). Traditional economies are becoming more rare.

Types of Economic Systems Command- Government will determine what will be produced & how it will be distributed & consumed. Government will set prices and set regulations (rules) that industries must follow.

Types of Economic Systems Market- Individuals, private companies, & consumers will determine what will be produced & how it will be distributed & consumed (Supply & Demand). Individuals and companies are allowed to produce freely without government interference.

Types of Economy MIXED- May have aspects of both market & command. Most common type in the world. EXAMPLES The United States is thought to have a “mixed” economy. The government does not decide what will be produced & how much it will cost, but it does regulate certain goods & services, such as illegal drugs Canada is thought to have a “mixed” economy. The government does not decide what will be produced & how much it will cost, but it does regulate certain goods & services, such as illegal drugs. The government also directly controls healthcare & education. A little bit closer to command than the USA.