The U.S. Economy EQ: How does a market economy protect consumers? (Turn in Green Book to page 248) Four Types of Economies 1. _____________ : all economic decisions are made by the government. 2. _____________ : based on the economic decisions of the past. 3. _____________ : some economic decisions are made by government and some by individuals. 4. _____________ : all economic decisions are made by individual producers & consumers Free Enterprise AKA-- ________________ Free Enterprise because each Called person is free to _______________. Key Components of Free Enterprise & a Market Economy each and give 1 example why it is Define so important: Private Property Voluntary Exchange Full Employment Productivity/Efficiency Division of Labor/Specialization Equity/Securities Test Practice page 253, #1-3 Circular Flow Model of Our Economy Circular Flow Dynamics How does the Circular Flow illustrate Economic Interdependence? What takes place in the Factor Market? What takes place in the Product Market? Test Practice page 257, #1,2,3 Economic Interdependence Usingthe Circular Flow Model, create a scenario that could actually happen in real-world and specifically show how it would affect each sector of our economy. Law of Demand When _________ go up, __________ goes down. When _________ go down, _________ goes up. Demand is the amount of a good/service consumers are wanting or needing to buy. Law of Supply When _________ go up, __________ goes up. When _________ go down, _________ goes down. Supply is the amount of a good/service producers are willing to produce. Complimentary Goods Productsthat go together. Name a complimentary good for each Mayonnaise Pepsi Paper Plates Flatscreen Plasma TV Substitute Goods Productsthat are basically the same. Name a substitute good for each Mayonnaise Pepsi Paper Plates Flatscreen Plasma TV Complimentary vs. Substitute Take 2 complimentary goods. What happens to demand for one when price for the other goes up? Take 2 substitute goods. What happens to demand for one when price for other goes down? What Affects Price Inflation:____________________ Deflation: ______________________ List everything you can that would influence the price of a new automobile.
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