Ch. 4 sections 3 and 5

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Economic Geography
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• Economy
• Consists of the production and exchange of goods
  and services among a group of people
• 2. Operate at local, regional, national, and
  international level

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• B. Types of economic systems
• 1. Traditional economy
• a. goods and services are traded without
  exchanging money
• b. also called a barter economy

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• 2. Command economy
• a. production of goods and services is determined
  by a central government, which usually owns the
  means of production
• b. production does not necessarily reflect
  consumer demand
• c. Also called a planned economy
• d. example former Soviet Union
• (Communist Government)

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• 3. Market economy
• a. production of goods and services is determined
  by the demand from consumers
• b. also called capitalism or (FREE ENTERPRISE)
• c. example
• United States

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• 4. Mixed Economy
• a. combination of command and market economies
  (actually any combination
• b. example
• China

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Economic Spectrum
Mixed Economy
Pure Communism,
Pure Free Enterprise
Sometimes called Planned Economy or Command
Economy
Sometimes called Free Market, Market Economy,
or Capitalism
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Economic Spectrum
Mixed Economy
Pure Communism,
Pure Free Enterprise
Technically Socialism is the Command Economy
However in America many politicians call the
Mixed Economy Socialist
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Economic Spectrum
Mixed Economy
Pure Communism,
Pure Free Enterprise
Singapore
Cuba North Korea
France Sweden
United Kingdom
United States
Germany
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Economic Spectrum
Mixed Economy
Pure Communism,
Pure Free Enterprise
United States
Democrats
Republicans
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The worlds population today is approximately 6
billion!
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• C. Levels of economic activity
• 1. Every business operates at one of four
  economic levels
• a. these levels describe how material is gathered
  and processed into goods and services, and how
  they are delivered to customers

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• 2. The four levels of economic activity
• a. primary activities
• (1) involve gathering raw materials
• (2) example
• gathering timber

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MINING
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Strip Mining
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Farming
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Lumber
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• b. secondary activities
• involve adding value to materials by changing
  their form
• MAKING A PRODUCT!
• 2 example manufacturing automobiles

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• Primary Milking the Cow
• Secondary - Making the cheese

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• Lumber Industry
• Primary Activity
• Furniture Industry
• Secondary Activity

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• Mining Industry (metals) - Primary Activity
• Automobile Industry - Secondary Activity

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• C. Tertiary Activities
• Involve providing business or professional
  services.
• Example salespeople, teachers, or doctors

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• d. quaternary activities
• 1. provide information, management, and research
  services by highly trained persons
• 2. example
• scientists

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• D. Natural resources
• 1. Materials on or in the earth such as trees,
  fish, or coal that have economic value
• 2. They only become resources when society has
  the technology and ability to transform them into
  goods

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• 3. Three basic types of natural resources
• a. renewable
• (1) can be replaced through natural process
• (2) examples
• trees and seafood

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• Renewable Resources include
• Wind
• Sun (solar)
• Water (hydro)
• Geothermal
• Timber

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• b. non-renewable
• (1) cannot be replaced once they have been
  removed from the ground
• (2) examples gold,
• silver, petroleum,
• natural gas, coal

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• c. inexhaustible energy sources
• (1) unlimited quantity
• (2) used for producing power
• (3) include sunlight, winds, tides

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• E. Infrastructure
• 1. Consists of the basic support systems needed
  to keep an economy going
• 2. Includes power, communications,
  transportation, water, sanitation, and education
  systems

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Infrastructure
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Infrastructure

• Sewer system

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• 3. The more sophisticated the infrastructure, the
  more developed the country
• F. Measuring economic development
• Per capita income
• Average amount of money earned by each person in
  a political unit such as a country
• -U.S. - 46,900
• - Japan - 34,000
• - China - 3,000
• - Haiti - 1,300
• 2008 estimate

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• Per Capita Income

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• Gross national product (GNP)
• a. total value of all goods and services produced
  by a country over a year
• b. reflects value of goods or services produced
  in one country by a company based in another
  country

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U.S. - 14.26 trillion (worlds largest
economy) (thats 14,260,000,000,000) China -
7.97 trillion (2nd largest) Japan - 4.92
trillion (3rd largest)
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• 3. Gross domestic product (GDP)
• a. total value of all goods and services produced
  within a country over a year

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GDP - Gross Domestic Product in trillions
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• G. Development levels
• 1. Developing nations (less developed)
• a. nations that have a low GDP and limited
  development on all levels of economic activity

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• 2. Developed nations (More Developed)
• a. countries with a high per capita income and
  varied economy
• b. economy has quaternary activities such as
  computer software development

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• 3. Newly industrialized Countries are in
  between More Developed and Less Developed
  Countries in per capita income and higher
  standard of living

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• 3. Standard of Living The quality of life in a
  country.

More Developed Countries Less Developed Countries
Low Infant Mortality Rate High (bad) Infant Mortality Rate
High Life Expectancy Low Life Expectancy
High Literacy Rate Low Literacy Rate
Industrial or Service Sector Jobs Mostly Agricultural Jobs
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• Standard of Living - Example

More Developed United States Less Developed Haiti
Per Capita Income 46,900 1,300
Infant Mortality Rate (per 1,000 live births) 6.26 59.69
Life Expectancy 78.11 years 60.78 years
Literacy Rate 99 52.9
Economic Sector Services Agricultural