Trade History of Georgia

1
Trade History of Georgia
2
Trade History of Georgia

• People have been trading in Georgia for hundreds
  of years. Long before Georgia was a state,
  Native American groups traded with each other.
• Trade makes a much wider variety of goods
  available to people.
• When Europeans came to the Americas,
  international trade came to Georgia. In the
  early 18th century, Europeans took huge amounts
  of resources from the region for export back to
  Europe.
• Timber, plant products, and animal pelts from
  Georgia were all sold in Europe.

3

• During the early 1700s, common crops in Georgia
  were rice, sugar cane, and indigo.
• Cotton farming came later in the 1700s. Cotton
  was the main crop until the 1920s.
• Today, farming is not the main source of
  Georgias economy. The economy does still
  include crops including cotton, peaches, corn,
  tobacco, and peanuts.

4

• Trade is the act of buying and selling goods.
• When nations agree to trade with each other
  without charging tariffs, the act is called free
  trade.
• Free Trade makes cheap foreign foods available to
  consumers.

5
Four Transportation Systems

• Savannah was chosen, in part, as Georgias first
  capital due to water access. Shipping has always
  been an important part of Georgias
  transportation system.
• In the 19th century, Atlanta, Georgia became a
  center of trade. During the Civil War, Atlantas
  industries grew. Railroads increased trade in
  Georgia, and linked the region to many markets.

6
Four Transportation Systems

• 3) Georgia's 1,244 miles of interstate highways
  perform several functions vital to the state's
  economy
• They connect Georgia to the rest of the nation,
  linking the state's major cities, and helping
  move suburban commuters to and from work centers.
  
• Georgia's interstate highways helped establish
  the state as a vital transportation hub for the
  Southeast.
• 4) Today, Hartsfield-Jackson Atlanta
  International Airport is one of the busiest
  airports in the world.
• Air transportation is vital to Georgia in the
  world economy.

7
Entrepreneurs

• An Entrepreneur is a person who takes the risk to
  start up a new business.
• Expenses are the costs for businesses to produce
  goods or services. The money a business receives
  from consumers is used to pay its expenses.
• Remaining money is called a profit. Profit is
  the main incentive, or reason, for starting a
  business.
• Entrepreneurs look for new businesses and ways to
  make a profit. They help expand and develop the
  economy.

8

• Risk is starting a business. An entrepreneur is
  a risk taker. An entrepreneur invests money in a
  new business, but cannot know if it will be
  profitable. A business may lose money. An
  entrepreneur will research a new business idea to
  find out the chances of success.
• Entrepreneurs and their businesses help Georgias
  economy. Coca-Cola, Delta Airlines,
  Georgia-Pacific, and The Home Depot are examples
  of Georgia businesses that were started by
  entrepreneurs.

9
(No Transcript)
10
Coca-Cola

• The company was started in the 1880s by a
  Georgian entrepreneur named John Smith Pemberton.
  
• Pemberton worked as a pharmacist. He created the
  cola formula and sold it as a health tonic. He
  had to compete with other tonics that were
  popular at the time.

11
Delta Air Lines

• Delta Air Lines is one of the largest airlines in
  the country.
• Delta began as an aerial crop dusting service,
  which sprayed farm crops with chemicals and
  fertilizer. The company was started in the 1920s
  by an entrepreneur named Collett E. Woolman.
• Woolman worked to expand Delta to offer passenger
  and mail services.
• In 1929, Woolman bought three planes and started
  flying passengers between Texas and Mississippi.

12
Georgia-Pacific

• Georgia-Pacific is a paper company based in
  Atlanta. It is one of the worlds top producers
  of tissue, paper, packaging, and building goods.
• The company was the idea of an entrepreneur named
  Owen R. Cheatham.
• Cheatham started the company in 1927 as a small
  lumber mill. He took the risk to expand his mill
  into a larger business.
• By 1938 the company was running five lumberyards
  in the South. In 1947, Georgia-Pacific bought a
  lumber mill on the Pacific Coast.
• The company continues to be successful and
  produce a wide assortment of goods.

13
The Home Depot

• The Home Depot is the worlds largest chain of
  home improvement stores.
• It started in 1978 by entrepreneurs named Bernie
  Marcus and Arthur Blank.
• Before The Home Depot opened, hardware stores
  were specialized. A consumer might have to visit
  many stores to buy the materials needed for one
  project.
• Marcus and Blank wanted their stores to sell all
  of the possible materials a person might need.
• The Home Depot changed the way that home
  improvement stores were operated.

14
Flash Quiz

• 3. Which one of these ideas are BEST associated
  with The Home Depot business model?
• A. Stores that only sell by order. Ships your
  order within a week.
• B. Only sells to large contractors.
• C. Sells home improvement, clothing and food
  items.
• D. A one-stop location for the project you are
  working on.
•  
• 4. When did international trade first come to
  Georgia?
• A. When Native American groups started trading
  with each other.
• B. When Europeans started trading with Georgia.
• C. During the 1996 Olympics when many nations
  were visiting.
• D. During the Civil War.

• 1. The term entrepreneur is best defined as
• A. Someone who owns a business, but does not
  handle its operation or management.
• B. A buyer of goods and services.
• C. Someone who takes on the operation,
  management, and risk of a new business.
• D. An employee of the airline industry.
•  
• 2. Georgia-Pacific is a company known for
  manufacturing
• A. Tissues, pulp, paper, and packaging.
• B. Automobiles.
• C. Processed meats and cheeses.
• D. Computers and software.

15
State Revenue
16

• All governments require money. Running the
  government as well as providing services both
  cost money.
• The money that local governments bring in is
  called revenue.
• The state of Georgia and its local governments
  have several ways of raising revenue.

17
Taxes

• Taxes in Georgia can be levied by the state as
  well as by counties and cities.
• A tax is a required payment to a government by a
  person or business.
• Taxes are the largest source of revenue for
  Georgia.
• There are many different kinds of taxes
• Income Tax Personal and Corporate
• Sales Tax
• Property Tax

18
Income Tax

• Income tax is a tax on money earned by people or
  businesses.
• Personal Income Tax
• Georgias largest single source of revenue.
• People who make more money pay a larger
  percentage of their income than those making less.

19

• Corporate Income Tax
• Usually a flat rate tax based on the money a
  company makes in Georgia.
• Taxes are only collected by the state, not by
  local governments.

20
Sales Taxes

• Sales taxes may be collected by state and local
  governments.
• A sales tax is a tax added to most retail goods
  and services.
• The amount of sales tax is calculated as a
  percentage of price.
• Sales taxes are Georgias second largest revenue
  source.
• Currently Georgia has a 4 state sales tax.
• Local governments can levy sales tax with voters
  approval. With a combined state and local sales
  taxes most purchases in Georgia have a tax of 7
  to 8.

21
Property Taxes

• Property taxes are a key source of funds for
  local governments in Georgia.
• A property tax is a tax placed on property such
  as land, homes, cars, boats, and business
  inventory.
• Property taxes are based on a percentage of the
  value of the property.
• Property taxes do not contribute significantly to
  state revenues.

22
Spending the Money

• Georgia is required by its constitution to have a
  balanced budget.
• This means the state cannot spend more money than
  it brings in.
• It may not borrow money or operate under a
  deficit.
• Keeping a balanced budget keeps the state out of
  debt and fiscally strong.
• It also limits programs on which the states
  money is spent.

23

• In Georgia many groups compete for state funds.
• The process of deciding how and where to spend
  money is complex. It involves
• Governor
• State Representatives
• State Legislature
• Special Interest Groups
• The governor submits a budget to the state
  legislature, this budget is then modified by
  legislators, and signed by the governorwho can
  veto items in the budget.

24
Georgia State Spending Georgia State Spending Georgia State Spending
Program Budget Funds Budgeted Percentage of Total
Education 7,963,725,135 52.02
Social Services 3,177,123,873 20.75
Criminal Justice 1,618,182,395 10.57
Debt Services 778,879,879 5.09
Transportation 688,508,938 4.5
All other state agencies 701,387,076 4.6
Property Tax Cut 380,000,000 2.5
25

• How revenue in Georgia is spent depends in part
  on how it is generated. Most taxes are put into
  a general fund from which many services are
  financed.
• State services include the public school system.
  School buildings must be maintained, and supplies
  bought to run the school.
• The state also maintains roads throughout the
  state. State parks and conservation areas are
  also maintained and protected.

26
SS8E4.a,b,c Quiz

• 1. In Georgia, both the state government and
  local governments share the power to
• A. Impose taxes.
• B. Operate military bases.
• C. Establish schools.
• D. Build interstate highways.
•  
•  
• 2. Which revenue source contributes the most
  money to Georgias state revenues?
• A. Personal income taxes
• B. Corporate income taxes
• C. Sales taxes
• D. Federal grants

• 3. Which revenue source is second in Georgia?
• A. Income taxes
• B. Road taxes
• C. Sales tax
• D. Property taxes

27
Personal Money Management
28

• For most people, their income is what they get
  paid for doing work. Some people, however, are
  able to live off of income from savings or
  investments. Income may also come from gifts or
  from selling something.
• The main goal of budgeting is saving money.
  Saving allows people to plan to buy something
  expensive in the future.
• By setting aside a small amount of money every
  week, it is possible to save a large amount of
  money over time.
• Saving also creates a store of money that can by
  used in an emergency.

29

• There are many different ways to save money.
• It is best to save money in some type of bank.
  In a bank, money can earn interest.
• Interest is a charge that the bank pays you to
  use your money.
• Although you can get your money at any time, a
  bank uses your money in various ways. For this
  privilege, the bank pays you a percentage of the
  amount that you have saved.
• The amount of interest paid ranges from less than
  1 to as much as 13 to 14.

30

• Interest rates at banks are based on the prime
  lending rate, which is set by the Federal
  Reserve.
• If 10 is placed in a bank account that earns 5
  interest, then 5 of the total balance of the
  account is added to it on a regular basis. Over
  time, this helps the money to grow.

31
Bank Balance 5 Interest Added
10.00 in May 0.50 at the end of May
10.50 in June 0.51 at the end of June
11.01 in July 0.55 at the end of July
11.56 in August 0.58 at the end of August
Notice that the bank balance started with 10 and
no new money is put into the bank, except
interest. If the person with the bank account
does not take the money out and just lets the
interest add up, the balance will continue to
grow. This effect is called compounding
interests. Compounding interest also affects
both savings and credit accounts.
32
Investing and Credit

• Investing is spending money in the hope of
  earning more money than is spent.
• One example of an investment that many eighth
  graders might have is a set of collectible
  trading cards.
• A card that is bought for 1 may someday be worth
  10. A return on investment of 9--which is
  900--is a very good investment.
• In almost every location, the value of homes
  increases over time. This increase is one of the
  reasons that homes are considered one of the best
  investments people can make.

33

• Stocks are another kind of investment that many
  people make.
• Stocks are small investments in large companies.
  If the company does well, the stock makes money.
  If it does poorly, the stock loses money.

34
(No Transcript)
35

• Facebook IPO 5/8/12 - 38.
• June - 23.
• Facebook 8/21/13 - 38
• Apple 2006 - 12
• Apple 2009 - 12
• Facebook last week - 82
• Apple last week - 125

36

• Every kind of investment involves risk. Risk is
  the possibility of losing money that has been
  invested.
• Often, the greater the risk of losing the money,
  the greater the possible return will be if the
  investment does well.
• Credit is money that is borrowed from a bank.
  When the bank uses your money, the bank pays you
  interest. But when you use the banks money, you
  must pay the bank interest.

37
Balance Owed 10 Interest Charge
100.00 borrowed in May 10.00 interest
110.00 owed in June 11.00 interest
121.00 owed in July 12.10 interest
133.10 owed in August 13.31 interest
The same compounding interest that worked in your
favor in a savings account will work against you
when you borrow money. This fact is why it is
important to only borrow when absolutely
necessary and pay back borrowed money as quickly
as possible. See the chart above to see how
compound interest on a credit card adds up.
38

• There are many different types of credit
• Credit Cards
• Home Loans
• Student Loans
• Electricity Service
• Phone Service
• Anytime money is owed, credit has been extended.
• The key to personal finance is never to borrow
  more than you can pay off in a reasonable amount
  of time.
• Learning to control and understand personal
  finance is the job of every adult.

39
SS8E5 Quiz

• 1. When the Federal Reserve sets the national
  base interest rate it is called the
• A. Prime lending rate.
• B. Primary interest hike.
• C. Centralized rate.
• D. Central-controlled interest.
•  
•  
• 2. For most people in the United States, what is
  the MOST LIKELY goal of saving money?
• A. Buying stereo equipment
• B. Buying a home
• C. Retirement
• D. Buying a car

• 3. The system of using electricity before paying
  for it is a form of
• A. Savings.
• B. Investment.
• C. Income.
• D. Credit.
•  
• 4. Which of the following is a correct statement
  about compounding interest?
• A. Compounding interest subtracts value from a
  savings account.
• B. Compounding interest plays a role in both
  savings and credit.
• C. Compounding interest plays a role in both
  savings and income.
• D. Compounding interest adds value to income.