Economic Understanding of Southwest Asia

What 3 economic questions are asked when studying the similarities of traditional, command, market, and mixed economies among nations of the world?

• What to produce, how to produce, and for whom to produce.

• What is your opportunity cost, why are economic resources needed, when should these resources be used?

• What is your opportunity cost, what economic resources are needed, why should these resources be used?

What is ‘specialization’?

• Producing all goods that the country needs so that trade with other countries isn’t necessary

• Producing goods a country can make most easily so that they can trade for goods that they can’t produce locally

• Directly trading goods with another country without having to use money

Why is specialization so valuable to international trade today?

• Most countries only make one product really well.

• It keeps the prices low on imported goods.

• Specialization allows people to do a more efficient job at producing what they make best and trade for the things they need.

Saudi Arabia specializes in the production of:

• Olives and grapes

• Oil and natural gas

• Oil and olives

Why has Israel specialized in the area of technology?

• It has few natural resources and little farmland.

• It has a poorly educated population.

• The country has little in the way of fishing.

The economies of Israel, Saudi Arabia, and Turkey can best be described as:

• Traditional

• Market

• Mixed

In a traditional economy, how are economic decisions made?

• Consumers

• Customs and Traditions

• Government Leaders

Why was OPEC created?

• To regulate the supply and price of oil

• To keep non-members from producing any oil

• To help Palestinian Arabs with problems with Israeli Jews

Where are most OPEC countries located?

• North America

• Southern and Eastern Asia

• Southwest Asia

What happens to the price of oil when OPEC countries decide to reduce production?

• Oil prices decrease

• Oil prices increase

• Oil prices stay the same