Europe's Economic System Study Guide Key PDF

Study Guide Europe’s Economic System Answer Key __________________________________________________________________________________________ I. Economic Systems 1. Fill in the chart with a definition and an example of the 4 types of economic...

Study Guide Europe’s Economic System Answer Key __________________________________________________________________________________________ I. Economic Systems 1. Fill in the chart with a definition and an example of the 4 types of economic systems: Economic System Definition Example Traditional Villages in Africa; rural areas of Based on customs and beliefs Canada (think Moana) Command Government makes all of the economic decisions Cuba, North Korea Market Private businesses make all of the economic No pure – US, UK decisions Mixed Private businesses are in charge, but government Most democratic countries regulates them 6. Most democratic countries have which type of economic system? Mixed 7. Most communist countries have which type of economic system? Command 8. What are the 3 basic questions that every economic system must answer? What to produce? How to produce? Whom to produce it for? 9. Define free enterprise. Which system is this found in? Competition between businesses; only found in market economies 10. What is bartering? Which economic system uses bartering to trade goods? Trading without using money; Traditional 11. Which economic system is based on individual choice? Market 12. Which European country is the closest to having a pure Market economy? Germany II. Trade Barriers 13. Fill in the chart below with a definition of the 3 types of economic trade barriers: Economic Trade Barrier Definition Tariff Tax on imported goods Quota Limit on imported goods Embargo Complete ban on trading 14. What are 3 examples of physical trade barriers in Europe? Mountains, frozen waterways, volcanoes Name _______________________ III. Economic Growth (Gross Domestic Product) 16. Fill in the chart below with a definition and an example of the 4 factors that contribute to economic growth: Factor Definition Example Human Capital College, nurse, band practice Education, healthcare, training Capital Goods Technology, factories, machines, Things that you sell or produce space crafts Natural Resources Gifts of nature Timber, oil, coal Entrepreneurship Someone who starts a business Walt Disney IV. Comparing European Economies 20. Russia’s economy has moved away from Command and more towards Market since 1991—why? Soviet Union collapsed. 21. What do the economic systems of United Kingdom, Germany, & Russia all have in common? Mixed 22. How do Russia’s harsh climate, size, and few navigable rivers affect its economic development? Hard to get to resources. V. Foreign Exchange 23. Define “foreign exchange”: Exchanging money with other countries 24. Why does international trade require a system for exchanging currencies? Not all currencies are worth the same amount; countries have different currencies.