Ch' 13 Section 3 WarmUp

1
Ch. 13 Section 3 Warm-Up

• On a piece of notebook paper in complete
  sentences, answer the following questions.
  Remember I will come around later in the class to
  check for completion and class-work credit.

• What are the three factors of production?
• What are the three questions that every company
  must answer before they start?
• What are the three types of economies?

2
Ch. 13 Section 3

• Three (3) Types of Economies
• The three types of economies are traditional,
  command and market economies.

• These systems are 3 different ways that a society
  can organize production, distribution and
  consumption to solve scarcity.

3
Traditional Economy

• Traditional Economy- the basic economic decisions
  are made according to long-established patterns
  of behavior that are unlikely to change.

• This type of economy is passed down from
  generation to generation. In most traditional
  economies all members usually work together to
  support their society and their family. (ex.
  Indian Tribes)

4
Command Economies

• Command Economy- the government or central
  authority owns or controls the factors of
  production and makes the basic economic decisions.

• In these economies the government is usually in
  charge of important parts of the economy.
  Powerful rulers and governments have often
  controlled their economies.
• (ex. Dictatorships)

5
Market Economies

• Market Economy a system in which private
  individuals own the factors of production and are
  free to make their own choices about production,
  distribution and consumption.

• In a market economy all decisions are made within
  the markets themselves. A market is a place where
  buyers and sellers agree to exchange goods and
  services.
• Competition is good in a market economy.

6
Conclusion

• In order to make any good or service you need the
  three factors of production (land, labor and
  capital) but before you can make anything you
  must answer three questions (what and how much?,
  how does it get made?, and how is it distributed?)

• Once the good or service is made there must be an
  economy to distribute the good or service in. And
  the three main types of economies are
  traditional, command and market.