Download - Economic systems2
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What is an Economic System?
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Opportunity cost- in order to have more of one thing; you must have less of another. Ex- more clothes, less money.
Scarcity- insufficiency or shortness of supply. Medium of Exchange- An intermediary
instrument used to facilitate the sale, purchase or trade of goods between parties. In modern economies the medium of exchange is currency.
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Family oriented, self sufficient
Decisions are made according to customs (Family, Tribal, Religion)
Live off the land
Little technological influences
Each member has a role
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Where might we find a “Traditional Economy”?
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Govt makes all economic decisions
What, where, and how to produce products
Control of resources, factories, workers, and retail
Control over production and price
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Can you think of any “Command Economies”?
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Individuals make economic decisions according to supply and demand
Driven by choice
Profit drives decision making Determines how resources are used
Creates competition
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Combines ideas of Command and Market Economies
Production is usually privately owned
Govt regulates and guides the economy
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Can you think of any examples of economic competition/restrictions in Lawrence?
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