How the Government influenceshow I make money. Take out a sheet of paper and answer thefollowing questions:◦ What are Goods?◦ What are Services?◦ What are Resources?◦ What is Scarcity? Def. The method used by a society toproduce and distribute goods and services. Or, How the government tells us what we canget and how to get … Continue reading “the Government influences | My Assignment Tutor”
How the Government influenceshow I make money. Take out a sheet of paper and answer thefollowing questions:◦ What are Goods?◦ What are Services?◦ What are Resources?◦ What is Scarcity? Def. The method used by a society toproduce and distribute goods and services. Or, How the government tells us what we canget and how to get it!1. What goods and services to produce?2. How will they produce them?3. Who will get them?4. How much will they produce now, and howmuch later? Each economic system answers thesequestions in a DIFFERENT WAY.There are 3 basic types of economic systems. Economic questions are answered by habitsand customs (the way it has always beendone) Children work the same jobs parents worked,often farming or hunter/gatherer Fear Change! Ex. Eskimos, the Amish,Pigmies, Bush People The government answers the basic economicquestions Advantages: able to act quickly inemergencies, provide for all people equally Disadvantages: Inefficient, no incentive towork hard or be creative Ex. Communist Countries (China, Vietnam,North Korea, formerSoviet Union, Cuba) Economic questions are answered byindividual buyers and sellers. Supply and demand influence economy People act out of self interest; motive forprofit (money) drives the economy Also known as FREE ENTERPRISE orCAPITALISM Ex. The United States, WesternEurope, Japan I said there were 3 types of economicsystems, but there is a 4th! Mixed Economy: No economy is pure market,pure command or pure traditional, elementsof each appear in all economies, some havemore elements of one economy than another.Market Mixed CommandUSA Great Britain China While the United States is mostly a freemarket economy, it does have elements of acommand economy.1. Economic Freedom: individuals have theright to choose2. Competition: more than one producer ofgood/services insures choice3. Private Property: individuals have the rightto own their own property, includingbusiness4. Self-Interest: individuals makedecisions based on what is best for them5. Voluntary Exchange: individuals may freelybuy and sell goods6. Profit Motive: individuals are driven by adesire to profit (make money)1. Government regulation of some businesspractices• Ex. Wages, labor hours,safety practice.2. Government limits certain choices• Ex. Cannot buy or produce certaingoods/services3. Government provides aid to the needy• Ex. Medicare, Medicaid, welfare How would my pizzeria function underdifferent economic systems? answer the basic economic questions! determine how much cheese and pepperonigoes on the pizza determine the quality of the cheese andpepperoni set my employees wages set my business hours The government answers the basic economicquestions The government sets the amount of cheeseand pepperoni on each pizza The government determines quality of cheeseand pepperoni The government sets employees wages The government sets business hoursProblem: What does the government knowabout pizza? The Government and I both answer the basiceconomic questions determine the amount of cheese andpepperoni on the pizzas; governmentdetermines the quality of cheese and pizza set employee wages; government setsminimum wage for employees determine business hours; governmentdetermines whether I am safe to be open ornot
