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Types of Producers

Types of Producers . Types of producers. There are many different types of producers in our economy. We can classify them as either private or public producers. Private Producers . These businesses are owned by individuals or groups that come from the household sector.

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Types of Producers

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  1. Types of Producers

  2. Types of producers • There are many different types of producers in our economy. We can classify them as either private or public producers

  3. Private Producers • These businesses are owned by individuals or groups that come from the household sector. • The main goal of producers in this sector is to make a profit. • Other private sector businesses are driven by the fact that they can see a need in the community and want to satisfy that need. These are Voluntary Organisations (non-profit organisations) • E.g. Salvation Army, Red Cross, World Vision Profit = Income earned by the firm – Expenses that it has to pay

  4. Public Sector Producers • These producers are owned by the government. • Central Government = the elected representatives who meet in Parliament and the Beehive – they are concerned with NZ as a whole. • The central government also owns firms which are run like private sector businesses (aim to make a profit) called State Owned Enterprises. • e.g. Meridian Energy Ltd • NZ Post Ltd • Local Government = Officials and representatives elected by the local communities e.g. Gore City Council.

  5. Public Goods • Not all the goods and services that consumers want will be provided by private firms. • This may be because there is no profit in providing them e.g. street lighting because everyone can benefit but no one will want to pay. This type of good is called a Public good • Public goods are provided by local and central government.

  6. Collective Goods • In New Zealand, most Public Goods are provided by the Government and are paid for by taxation • These are referred to as Collective goods when paid for or provided by the Government. E.g. Roading, Parks, Streetlights

  7. Mixed Goods • The Government may also provide some goods that the private sector also provides e.g. education, health care. These are called Mixed Goods • They will do this because if left to the private sector, not enough would be provided and it would be too expensive for many people.

  8. Private Goods • Private goods are brought by consumers in markets. E.g. ice cream • Governments may also choose to provide private goods and services e.g. solid energy coal

  9. Mixed Goods

  10. Merit and Demerit Goods • Other reasons that both local and central government provide goods or services are because they think they are good for you! E.g. immunisations • These goods or services are referred to as Merit Goods • The opposite of a merit good is a Demerit Good. e.g. alcohol. • The Government will try to discourage consumption of these through laws, advertising and taxes.

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