2. Command Economy – The government owns most of the resources and determines the production of goods and services. Market Economy – Production of goods and services is determined by the demand from consumers. Also called “capitalism.” Mixed Economy – A combination of market and command.

3. Three Levels Primary Secondary Tertiary

4. Primary Activities (Dealing directly with natural resources.) Examples: Fishing Farming Forestry Mining

5. Secondary Activities (Manufacturing and processing.) Examples: Steel mills Automobile assembly Saw mills

6. Tertiary Activities (Services) Examples: Transportation Retail sales Information Technology Services

8. 1. Different levels of natural resources Renewable—Soil, water, forests Nonrenewable—Fossil fuels (oil, coal, natural gas) and metals (gold, iron, copper, bauxite)

9. 2. Human resources Level of education Level of skills. Entrepreneurial and managerial abilities

10. 3. Capital resources Level of infrastructure Availability and use of tools, machines, and technologies Availability of money for investment

11. How advanced an economy is.

12. Why are some country’s economies more developed than others?

15. The purpose of a colony is to provide natural and human resources to enrich the “motherland.” The people of the colony usually do not share the wealth.

16. Many of the world’s poorest nations were once colonies of imperial powers?

17. MEASURING THE ECONOMY The value of all goods and services produced in a nation in a year. GDP divided by total population.

20. Source: World Bank

21. G-7 nations: United States, United Kingdom, France, Germany, Italy, Japan, Canada.

22. The merging of regional economies in which nations become interdependent on each other.

23. How does globalization effect your life? Cheaper products More competition for jobs

24. A trading nation’s ability to produce something at a lower cost than another trading nation. Portugal 2 hours to produce 1 jug of grape juice. 6 hours to produce a yard of cloth. Germany 4 hours to produce 1 jug of grape juice. 3 hours to produce a yard of cloth. Make and trade grape juice. Make and trade cloth.