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Economic GeographyPeople earning a living
Economic Systems
4 money making activities: primary, secondary, tertiary & quaternary activities.
Primary Activities : use natural resources (wheat farming, iron mining)
Secondary : use raw materials to produce or manufacture something new (processing wheat into flour, manufacturing steel)
Economic systems
Tertiary Activities: provide services to people and business (bakeries, car dealerships)
Quaternary : process and distribute information ( plant-genetics research, automotive engineering)
Economic Systems
4 types found around the world.
Most basic is traditional or subsistence.
People make goods for themselves and their families.
Market economy is where people choose to buy and sell.
Free enterprise allows the product price to be determined by competition.
Free Enterprise
Is the system that capitalism is based on.
Business need to make profits. Profits drive the business decisions.
Supply & Demand sets prices.
In capitalism business, industry and resources are privately owned.
Business and regions sell their products at the highest profit margins.
Most of the worlds richest countries have market economies. Japan, USA, Australia are market economies.
Command Economy
The government makes major economic decisions.
Govt decides what to charge, produce and where to make it.
Prices are not based on supply & demand.
North Korea is an example of a command economy.
Level of development
Refers to a country’s steady improvement and quality of life.
Measures of development are GDP & GNP.
GNP is the total value of goods and services that a country produces in a year.
GDP –goods and services produced within a country.
Industrialization – process of by which manufacturing based on machine power becomes widespread in an area.
Level of development
Standard of Living
Level of development determines standard of living.
Measured by personal income, level of education, food consumption & literacy rate.
Literacy rate is the % of people who can read and write.
Other measures are healthcare, technology & life expectancy.
Developed & Developing Countries
Developed – world’s richest nations. High levels of industrialization & standard of living.
Less than 25% of the world are developed nations.
US, Canada, Australia, Japan, Germany, Italy are examples of developed nations.
Most people who live in developed cities live in cities, high GDP, literacy rates, life expectancy & low birth and death rates.
Developed Countries
Few live on farms but the farms produce large amounts of food.
Good infrastructure which consists of roads, ports and other facilities.
Have global market economies.
Developing Countries
World’s poorer nations.
Less productive nationally.
Lower standards of living.
Most are located in Africa, South America, Asia & Central America.
Low GDP, high birth & death rates, few go to high school & college.
Emerging Countries
These are the countries that fall in between the rich and poor countries.
Middle income nations.
They include Mexico, Brazil, India, Thailand & Malaysia.
Have features of both developed & developing nations.
Cities may be modern but the rural areas are very poor.
