Middle East/Africa Economic Terms from the 7 th grade standards Take notes! Quiz to come! Take notes! Quiz to come!

Distribution Economy  A distribution economy is dependent completely upon one resource for their finances (AKA specialization)  An example of a distribution economy is any Middle Eastern country that relies upon oil production

Market Economy  A country which practices free enterprise with no government involvement  An example of a market economy could be a small scale community or village that uses bazaars and bartering

Mixed Economy  An economic system in which some businesses are government run and some are free enterprise.  The U.S. is an example of a mixed economy

Voluntary Trade  Voluntarily purchasing something where both groups are financially or mutually benefited  One group volunteers to sell it, another volunteers to buy it  Ex: Persian Rugs in Iran, Apricots in Turkey

Import  Goods brought into one country from another through trade or sale  We import oil from the Middle East Export  Goods and services traded with or sold to other countries Saudi Arabia exports oil to the rest of the world

GDP  Total value of all goods and services produced in a country in a given time period  Example: In 2007, Jordan calculated the value of its goods and services at billion dollars.

Trade Barriers  Any law or practice that a government uses to limit free trade between countries…it could be a political or military obstacle to trade  Examples: chokepoints, military blockades, Iranian sanctions, Israel and the Muslim World

Currency  Something in movement as a standard of trade (usually the money used for trade)  To give something away and get something back as a substitute (the process of trade) Exchange

Human Capital  This is knowledge and skills that allow workers to produce goods and services and earn an income.  Example: A company that invests in training for its workers.

Traditional Economy  Subsistence-level (survival, agricultural- based) economy  Example: much of Sub-Saharan Africa… any country or community where food is raised for survival rather than INCOME

Commodity  A valuable or useful economic good  Example: oil is a commodity for the countries bordering the Persian Gulf in the Middle East along with minerals mined in North Africa

Entrepreneur  Someone who organizes, manages, and assumes business risks  Ismail Pasha (Suez Canal) is an example

Command Economy  An economic system in which the government decides what goods will be produced, how they will be produced, and how they will be distributed  The strict Islamic law present in Saudi Arabia borders on a command economy, but true examples include North Korea and Cuba

OPEC  The Organization of Petroleum Exporting Countries works to set a fair price for oil traded throughout the world.

Supply & Demand  When you have a lot of something the price goes down and when you have little of it the price goes up!  Example: When Iraq invaded Kuwait and began destroying their oil pipelines, the price of oil went up because the supply was lower but the demand remained high.