1. Economics a social science concerned with how people satisfy their demand when the supply of the following is limited: Goods (things you can buy) Services (things people do for a fee)
2. Economics is about the flow of goods and services between people. Even though it is about mathematics, it is a social science because people play a central role in it.
3. People play a central role by purchasing their needs (essential items) and wants (items not necessary to survive). When there are not enough goods to meet those needs there is an economic situation called scarcity
4. An Economic System is a method used by a society to allocate goods and services among its people and to cope with scarcity. Factors that affect what kinds of economic systems: Politics Moral Issues Cultural Differences
5. Every economic system answers four basic questions which are the fundamentals of economics: What goods and services are produced? What quantity of goods and services are produced? How are goods and services produced? For whom are goods and services produced?
6. Command Economy The government controls the production, allocation, and prices of goods and services.Market Economy Suppliers and consumers control the production, allocation, and prices of goods and services. United States, Canada, Australia, Hong Kong.Mixed Economy Blend of a Command Economy and Market Economy. All modern countries are mixed, but lean heavily towards one or the other.
7. Command Economy Control what suppliers produce How much is produced How it is produced How goods are distributed throughout the country and the prices people pay for them.
8. Socialism and Communism are strongly associated. Although no country has a strict command economy, there are several that are close: China Russia Syria Iran Korea Vietnam