At what age do children start to develop brand

loyalty?”…take a guess….

2 years old!!!!Kids can recognize a brand/ therefore want it

• Once the brand light-bulb goes on, children learn to nag (they want validation for recognition)

• In a market economy, children are raised to recognize company logos by the media

• Free-market consumers have freedom of choice & will choose brands they recognize

What do YOUUUU know???

• http://www.sporcle.com/games/g/corplogos • http://www.sporcle.com/games/g/herologo

In the U.S. we have….

A – the freedom to own/ controls the factors of production (market system - capitalism)

B – a responsibility to follow government rules/ regulations (command system)

C – a “mixed” economy

Capitalism: economic system in which private individuals own the factors of production. It is another name for the market system.

• Pure capitalism lets people/ businesses make their own economic decisions without gov’t interference

We will be playing thisssss later in the year…

Government regulations in business include:

–The quality of foods/ drugs–Watch over nation’s banking system–Inspect workplaces for hazards

–Protect environment

Laissez-faire: economic system in which the gov’t minimizes its interference

with the economy (“let people do as they choose” in French)

Adam Smith (1776) said that individuals left on their own would work for their own self-

interest… they would be guided by an invisible hand to use resources efficiently, therefore achieving the maximum good for society

Does gov’t have a right to control a nation’s resources or should that be left to individuals? WHY???

If you were given the responsibility of writing a NEW CR North handbook,

consisting of 10 main rules, what would they be????

Free-enterprise system: economic system in which individuals own the factors of production & decide

how to use them within legal limits

• You have freedom to own/ control the factors of production BUT are not guaranteed to succeed

• You still need to follow gov’t regulations to protect your business & the community around you– Example: you know how to wash cars very efficiently so

you want to open up a professional carwash in your backyard but cannot (zoning regulations, hazardous waste disposal rules, etc…)

a.k.a…… MIXED ECONOMY

Buyer’s Choice

• Buyers (not sellers) make the decisions about what should be produced–Example: If a lot of people choose to buy

one video game, that company will do well – if no one chooses to buy it, that company will do poorly

Profit Incentive• Profit: amount earned after a business subtracts

its costs from its revenues • Includes cost of production, wages, rent, interest,

taxes• Profit Incentive: desire to make money that

motivates people to produce & sell goods & services

• This is what motivates entrepreneurs to create new products/ services

Private Property: whatever is owned by individuals rather than

by government• You are free to buy whatever you have

the funds to do so–Land, a business, a car, shoes, etc…

• You control how, when & by whom your property is used

Competition: rivalry among producers or sellers of similar goods & services to win more business

• A free-enterprise system encourages competition• Businesses have to keep prices low enough to

attract buyers, yet high enough to make a profit• This forces businesses to keep their costs of

production as low as possible• Goals = lower prices/ better quality Can we get

another round of Simon

Sayssss???Think K-Mart!!!

For Tomorrow…..

Please have the following key terms completed for points

DEFINITIONS & FULL EXAMPLES

#1-16

The American Economy

__________: economic system in which private individuals own the factors of production. It is another name for the __________________.Pure capitalism lets people/ businesses make their own economic decisions ________________________________________.

Government regulations in business include: - The quality of _________/ ___________

- Watch over nation’s banking system- Inspect workplaces for hazards

- Protect ____________________

___________________________: economic system in which the gov’t minimizes its interference with the economy (“let people do as they choose” in French)

_________________________________________: economic system in which individuals own the factors of production & decide how to use them within legal limitsYou have freedom to own/ control the factors of production but are not _________________to succeedYou still need to follow _________________________to protect your business & the community around you

Example: you know how to wash cars very efficiently so you want to open up a professional carwash in your backyard but cannot (zoning regulations, hazardous waste disposal rules, etc…)

Buyer’s ChoiceBuyers (not ____________) make the decisions about what should be producedExample: If a lot of people choose to buy one video game, that company will do well – if no one chooses to buy it, ________________________________

Profit Incentive___________: amount earned after a business subtracts its costs from its revenues

Includes cost of production, wages, rent, interest, taxesProfit Incentive: desire to make money that ________________people to produce & sell goods & services

This is what motivates _______________________to create new products/ services

_________________________________: whatever is owned by individuals rather than by governmentYou are free to buy whatever you have the funds to do so (Land, a business, a car, shoes, etc…)You control how, when & by whom your __________________is used

____________________________: rivalry among producers or sellers of similar goods & services to win more businessA free-enterprise system encourages competition

Businesses have to keep prices __________________to attract buyers, yet ______________________to make a profitThis forces businesses to keep their costs of production as low as possible

Goals = __________________/_____________________