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JA Economics

JA Economics. Chapter 2. Page 16. Free Enterprise. Free to make choices Make the choice they believe offer them the most benefits Gets it’s strength and support from 6 pillars. Page 17. FREE enterprise. Private Property. Page 17. Private Property .

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JA Economics

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  1. JA Economics Chapter 2

  2. Page 16 Free Enterprise • Free to make choices • Make the choice they believe offer them the most benefits • Gets it’s strength and support from 6 pillars

  3. Page 17 FREE enterprise Private Property

  4. Page 17 Private Property • Resource/product owned by individuals or businesses • Protected by the U.S. constitution • Businesses have an incentive to maintain their property

  5. Page 17 FREE enterprise Private Property Specialization

  6. Page 17 Specialization • Businesses and people • One product or a few parts of one product • Contributes to higher wages and profits

  7. Page 18 FREE enterprise Voluntary exchange Private Property Specialization

  8. Page 18 Voluntary Exchange • Because of specialization • No one person or business makes one entire product • Everyone is dependent on other people

  9. Page 18 FREE enterprise Voluntary exchange Private Property The Price System Specialization

  10. Page 18-19 The Price System • Buyers and sellers look towards the price to send them a message • Provides incentives • Businesses have a desire to make a profit

  11. Page 18-19 The Price System • Price doesn’t determine all economic behavior • Values • Charity • Opportunity • Convenience, service, loyalty, quality etc

  12. Page 16 FREE enterprise Market competition Voluntary exchange Private Property The Price System Specialization

  13. Page 20 Market Competition • Define Market • Resources • Products • Scarcity

  14. Page 16 FREE enterprise Market competition entrepreneurship Voluntary exchange Private Property The Price System Specialization

  15. Page 21 Entrepreneurship • Helps the economy grow and change • Three characteristics of an entrepreneur • Innovative thinking • Management skills • Risk taker • Page 15 in the study guide

  16. Page 22 Economic Systems • Market system (free enterprise) • Command system • Traditional system • Mixed – no pure form

  17. Page 23 Economic Models • Represent the real world • Descriptive, predictive and ideal • Want-satisfaction chain in chapter 1 • The circular flow of money, resources and products.

  18. Goods and Services Market G & S Goods and Services households Production Resources Market Resources Resources

  19. Circular flow of money • How it grows • How it shrinks

  20. Adam Smith • Born in Scotland in 1723 • University of Glasgow at age 14 • Economy evolved • People traded with once another

  21. Adam Smith • Born in Scotland in 1723 • University of Glasgow at age 14 • Economy evolved • People traded with once another

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