PRIVATE PROPERTY CHOICES Sell Items Impossible Owning Buy CORRECT Owning Buy Sell Impossible Items

PRIVATE PROPERTYCHOICES

• Sell• Items• Impossible• Owning• Buy

CORRECT

• Owning• Buy• Sell• Impossible• Items

MARKETS & PRICESCHOICES• Supply• Exchange• Demand• Open

Market• Prices

CORRECT

• Exchange• Open

Market• Supply • Demand• Prices

INCENTIVES/SELF-INTEREST

CHOICES• Consumers• Needs• Wants• Profit• Self-Interest

CORRECT• Self-interest• Profit• Consumers• Wants• Needs

FREEDOM OF CHOICECHOICES

• Services• Choose• Produce• Consume• Goods

CORRECT

• Choose• Produce• Consume• Goods• Services

COMPETITIONCHOICES

• Profits• New Ideas• Compete• Attractive• Prices

CORRECT

• Compete• Profits• Attractive• New ideas• Prices

LIMITED GOVERNMENT ROLE

CHOICES

• Government

• What• How much• Fair• Compete

CORRECT

• Government• What• How much• Fair• Compete

THE M

ARKET ECONOMY

PRIC

ES UP,

PRIC

ES DOW

N ACTI

VITY

Find out how different

situations can affect how much

stuff costs!

Producer says…

I manufacture the world’s best cupcakes! I just

heard a storm wiped out the sugar cane crop. Now there’s going to be less

sugar to meet everyone’s demands!

Will the price of cupcakes go UP or DOWN?

The price of sugar will go up, so my cupcakes will cost more to make. I’ll

have to raise the price of cupcakes.

Producer says…

I manufacture radios. I just installed a new high-

tech machine that lets me make twice as many radios for half the cost!

Will the price of radios go UP or DOWN?

It won’t cost me as much to make the radios, so I’ll be able to sell them at a lower price. That means

more people will buy them (hopefully)!

Producer says…

I own an oil refinery. Summer is coming, and people are going to be driving everywhere!

They’re going to need LOTS of gasoline. It’s

going to be hard to keep up!

Will the price of gasoline go UP or DOWN?

I’ll have to raise the price of gasoline to keep up

with the increased demand, especially if I

can’t maintain the same supply.

Producer says…

I sell landscape rocks. I just ordered TONS, but a new gardening show has got everyone decorating

with gnomes instead. What am I going to do with all these rocks??

Will the price of rocks go UP or DOWN?

I’ve got to get rid of all these rocks somehow. I’ll

put them on sale and hope people will buy

them at the lower prices!

Producer says…

I’ll have to charge a lot for these chairs, because

the new technology is expensive to make. But I

don’t have any competition, so I won’t worry about the high

prices.

Will the price of self-folding chairs be HIGH or LOW?

I just invented the world’s first self-folding chair! It folds itself up and puts

itself away. Nobody else makes anything like it!

Producer says…

Self-folding chairs are so popular, I decided to make some too. I can

produce 9,000 chairs a day and distribute them to all the major stores!

Mass-producing these chairs makes them

cheaper to manufacture. I can charge a lower price. My competition will have to lower her price too, or she’ll go out of business!

Will the price of self-folding chairs go UP or DOWN?

A. REVIEW

• 5• 3• 1• 7• 6• 4• 2

B. MOTIVATED

• Thumbs down• Thumbs up• Thumbs down• Thumbs up• Thumbs down

C. A CIRCULAR FLOW

D. WHAT’S THE OPPORTUNITY COST

1.The money she would have earned.2.The 12 cent interest from the

bank.3.The more certain money from

casual dresses.4.The possibility of making an extra

million dollars.

E. THREE KINDS OF ECONOMICS

Market economy

Command economy

Traditional economy

Private property

Incentives

What is produced

Competition

E. THREE KINDS OF ECONOMICS

Market economy

Command economy

Traditional economy

Private property

H F J

Incentives K D B

What is produced

G A I

Competition

E L C