Economic Systems

Ivan works in a government owned car factory because this was the job he was assigned. Every day he works hard to meet production goals set by his leaders. He his happy to do the work because he knows he is doing his part to keep his government strong and powerful.

In which type of economy does Ivan work?

• Command

• Market

• Traditional

• Mixed

In eastern Africa, the Maasai people have an economy based on raising cattle, goats, and sheep. They have lived this way for many generations. Maasai groups share grazing land and water and exchange livestock as a way to establish group bonds. This system allows the Maasai to take care of each other and focus on the needs of the children and the elderly.

What type of economic system best describes the one the Maasai use?

• Command

• Mixed

• Traditional

• Market

Steve started a technology company because he noticed people really like new technology. At first Steve decided to make cell phones. Then he noticed that man people were buying tablets as well. Steve realized he could make even more profit if he manufactured tablets and cell phones. Now Steve runs an even more profitable company. The government does NOT tell Steve what to do, and because of this he pays his employees as little as possible and does not have health care benefits.

What type of economic system does Steve participate in?

• Traditional

• Market

• Mixed

• Command

Abby was tired of working at a bank and decided to follow her love of baking. She got a loan and opened a cake shop that specializes in creating wedding cakes. Abby puts in long hours making amazing cakes, but she is happy because she is following her dream. Abby also has to make sure she is following government regulations about food safety. Abby has to wear gloves when working with food items and make sure foods that can spoil are always kept at cold temperatures. Abby joined a Bakers Association to help keep up with the rules around food service.

What kind of economy is being used in Abby's society?

• Market

• Traditional

• Command

• Mixed

Surplus is the amount left over after a goal is met.

• True

• False

Scarcity is:

• the surplus of an item

• the control of an item

• the short supply of an item

Profit is a financial loss.

• True

• False

Answer explanation

Profit is financial gain!

Supply and demand impact the __________ of an item or resource.

• price

• profit

• surplus

• scarcity

Gas station A sells gas for $2.75/gallon. Gas station B across the street sells gas for $2.74/gallon. The next day, Gas station A lowers its price to $2.74/gallon.

Which term describes why they did this?

• innovation

• supply and demand

• opportunity cost

• competition

Maria goes to the store and buys a new backpack.

• Maria is a consumer

• Maria is a producer

• Maria is making a profit

• Maria is owning a business