2. Bellwork: Just answer in notes  What kind of government is this?  How do you know?

3. Chapter 4-3 Notes  Economy = the system that includes all of the activities (jobs) that people do to earn a living  Hear “economy” – think “businesses”  “The economy is doing well.” – Basically means that businesses are doing well.  “The economy is doing poor.” – Basically means that businesses are doing poor and people are losing their jobs.  There are 3 types of economies….(page 94)

4. 3 stories

5. The story of Whispering Wind  Whispering Wind was young man known for his craft. The whole village would brag to his father, Sitting Bull, about how comfortable and appealing his deerskin blankets were.  Many people from neighboring tribes would barter valuable goods for these deerskin blankets.

6. The story of Whispering Wind  Whispering Wind would love it when winter came.  People would wait outside his teepee with their finest homemade goods, such as moccasins (like shoes), headdresses, meat and vegetables of all kinds.  Whispering Wind really didn’t need much of that though because his family had their own garden and hunted much of their own food.

7. The story of Whispering Wind  Often he would trade his deerskin blankets for things his family did not produce, but other people in the tribe did; such as moccasins, tools like arrows and spears, and even luxury items like headdresses.  All of Whispering Winds village makes their own goods and they barter with each other for goods that they don’t produce.

8. The story of Whispering Wind 1. What does barter mean? 1. Barter means “to trade” 2. What do you think you know about Whispering Wind? 3. What do we call this kind of economy? 1. A traditional economy is where people make their own goods and trade for what they cannot produce.

9. The story of Bud.

10. The story of Bud  Bud is very well known across his town. Many people come to his mechanic/tire shop, known as Bud’s Tire.  He is very friendly, only hires well trained and friendly people, and pays them well.  People often come to Bud’s Tire to get their cars and trucks fixed.

11. The story of Bud  Then one day, another store known as Steve’s Tire opened up down the street with lower prices.  Now many of Bud’s former customers were going to Steve’s Tire to get their cars and trucks fixed.  Bud thought…..and thought….and thought…and realized just what to do!

12. The story of Bud  Bud lowered his prices and advertised them on big signs in front of his store!  Bud got his customers back because they were attracted to his lower prices!  These stores battled over prices back and forth until both stores were barely making a profit.  This bothered Bud, because he had to cut his employees salaries; meaning that he had to pay them less money.

13. The story of Bud  Then Bud got another idea!  He would hire mechanics to fix tractors!  There were very few tractor mechanics and a lot of farmers around the outside of town.  Since there was a high demand for tractor mechanics, Bud could charge more money for his services.  Bud put up big signs again advertising that he was the only tractor mechanic for 20 miles. (which was true) People brought their tractors to Bud.  It was expensive to get the tractor fixed, but people paid it because there was no competition.

14. The story of Bud 1. How did Bud determine his prices? 2. Why did people go to Steve’s Tire? 3. How is business competition good for consumers? 4. What do we call this type of economy? 1. A market economy is a system where private citizens own businesses and make all business decisions. 2. This is also called capitalism and free enterprise.

15. The story of Mr. Kim

16.  Mr. Kim works for the government.  Most everybody that Mr. Kim knows also works for the government.  Mr. Kim works on a government-owned farm and is under a lot of pressure to make sure the crops grow.  The government tells Mr. Kim what to grow and where to send his crops when they are harvested.  He doesn’t sell them to the highest bidder, because the government owns all the farms and businesses.

17. The story of Mr. Kim  Mr. Kim’s friends work in many other industries, but they are all owned by the government.  His friend, Sou, who works in a store does not get to set prices or determine what is sold. The store is also owned by the government.  No one in Mr. Kim’s country owns cars except top government officials.  Mr. Kim, Sou, and most everyone else they know ride the bus or subway everywhere.  Only top officials are allowed to own cars.

18. The story of Mr. Kim 1. How is this government system different than the other two? 2. What do we call this economic system? 1. A command economy is a economy where the government owns all businesses and makes all business decisions. 2. Very similar to Communism. Read page 684-685

19. Read and outline page 94 “Economic Systems”

20. Economic Systems II. Economic Systems A. Traditional Economy 1.People grow own food/make own goods 2.Trade (barter) takes place (Barter = trade w/o money) 3.Example = Native Americans B. Market Economy 1.Individuals own their own businesses 2.Also called Capitalism and Free Enterprise 3.United States is an example C. Command Economy 1.government makes all business decisions 2.Ex. North Korea and Cuba 3.Most Communist nations have a Command Economy (read 684- 685)

21. Economic Industries The k-nowlege continues….

22. Put these into categories  Teacher  Lawyer  Doctor  Farmer  Fisherman  Nissan plant worker  Hershey plant worker  Coal miner  Police officer

23. What number comes to mind when you read these words?  Primary?  Secondary?  Tertiary?  (Ternary = arranged in threes, or having a base of three)  (tercentenary = a 300 th anniversary)  Quaternary?  (Quatrain = A stanza or poem of 4 lines)  (quadrennial = happening once in 4 years)  (Quadriceps = the large 4 part extensor muscle on the front of the thigh)

24. Types of economic activities (jobs) I. Economic Activity A. Primary Industry 1.Uses natural resources, or raw materials 2.Provide raw materials to others. 3.Ex. Farming, fishing, mining B. Secondary Industry 1.Use raw materials or nat’l resources to manufacture new products 2.Ex. Furniture makers, automobile manufacturers, etc.

25. I. Economic Activity (cont.) C. Tertiary Industry 1.Goods and services are exchanged 2.People who work to sell goods: grocery store workers, car salesmen, etc.. 3.People who perform services: mechanics, teachers, doctors, bankers D. Quaternary Industry 1.People who work with information rather than goods 2.Examples include scientists, architects, lawyers