1. What is the difference between a market, command, and traditional economy?

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1 Study Guide for 1 st Nine Weeks QPA 1. What is the difference between a market, command, and traditional economy? Traditional: People produce for themselves what they need to survive. They farm, hunt & gather. They make their own products. Command: People produce whatever the government decides and however the government decides. They use a class reward system to determine for whom to produce. Market: People produce what people want to buy and sell. They use supply and demand to determine how to produce. For whom to produce is determined by how much a person wants to pay for a good or service. 2. What is a tariff, quota, and embargo? Tariff: taxes on imported goods which cause the consumer to pay a higher price for an imported item. Demand is then increased for the lower priced item produced at home. Quota: restrictions on the amount of a good that can be imported into a country. Quotas can cause shortages that create prices to rise. Embargo: forbid trade with another country (Ex. The U.S.A. has had several embargoes against Iran because of Iran s involvement with terrorist activities). 3. What is specialization? Who takes the risk in specialization? Specialization: A focus on a particular aspect of producing a good that others might want or need at a lower cost. (No country can produce everything it needs so trade begins to unfold). The country producing the item for sale takes the risk that others will buy their product. 4. What is human capital, why is it important to invest in it, and what are the consequences for not investing into it? Human Capital: The actual people who perform the labor at a working environment. It is important to invest in human capital by educating and training the people of a country in order to raise the GDP. Education and the abilities it develops create a smarter more productive workforce, which leads to greater economic growth. By not investing in human capital a country may risk high unemployment and an educational system that is weak which drives down the economy and GDP. 5. What is the difference between an ethnic and religious group? Ethnic group: is identified on the basis of religion, race or national origin. 3 major ethnic groups in the Middle East are Arabs, Persians and Kurds. Religious group: has a distinct identity based on common religious beliefs and practices. 3 major religious groups in the Middle East are Jews (Judaism), Christians (Christianity) and Muslims (Islam).

2 6. Why is it important for nations to have a system to convert from one currency to another? Because different countries have different types of money, international trade requires a system for exchanging currencies between nations. 7. Where do the Arabs, Kurds, and Persians mainly live, what is their main religion, and what language do they speak? 8. Fill in the chart below. Where it was founded Founder Sacred Text Place of worship Basic Beliefs and Practices Christianity Judaism Israel Jesus Bible Church Israel Abraham Torah Synagogue There is only one God and Jesus is the son of God. There is only one God and they are waiting on the Messiah Islam Saudi Arabia Mohammed Quran Mosque Allah is the only God. Muhammad Koran

3 9. Who were the Sunni and the Shia and what caused the split between them (refer to chart from class)? Sunnis make up the majority at about 90% they believe any Muslim can be the Caliph (religious leader) whereas the Shia are the minority at 10% they believe on a direct descendent of Muhammad can be the imam (religious leader) 10. What impact did European powers have on the area of Southwest Asia after the collapse of the Ottoman Empire? The European powers divided up the region with little care for whom already lived there and how they felt. 11. What is Zionism? a movement that believed in the creation of a Jewish State. 12. Why was the State of Israel created? During WWII and after the holocaust the Jews that had fled needed a place to call their own. 13. What is OPEC, where are most of its members located, and how do these members benefit from belonging to it? OPEC is the Organization of Petroleum Exporting Countries, founded in 1960 to regulate the price and production of oil. Most member countries are from the Middle East. Membership helps keep oil prices stable for OPEC members. 14. Why is OPEC so powerful, and what impact can their decisions have on the rest of the world? OPEC influences the price of oil on the world market. OPEC countries produce over two-thirds of the world s oil. 15. List and describe the economic systems of Israel, Turkey, and Saudi Arabia. All of the countries have a mixed economy. Israel s economy is based on advanced technology, and they have invested much in human capital. This has made up for the lack of good farmland and natural resources. Service industries make up much of Israel s economy. Saudi Arabia s king and advisors make most of the economic decisions for the country. Their economy is based on oil, and they have invested much in human capital. Although much of the economy is controlled by the government, they are encouraging private business ventures. Turkey - many of Turkey s industries are controlled by the government, but in recent years more private businesses have been allowed. Service industries make up much of Turkey s economy.

4 16. What are the major resources of the Middle East? For those countries that do not have a vast supply of resources, how do their economies make up this deficiency? oil and natural gas, they diversify their economies with through technology, services, and agriculture 17. How has the unequal distribution of water impacted where people live in Southwest Asia? People tend to live near sources of water. Unequal distribution of water has caused SW Asia to come up with alternative sources of water such as desalination plants, drip irrigation, and importing water.

5 Be able to locate and label the following places on a map: Afghanistan, Iran, Israel, Saudi Arabia, Iraq, Turkey, Euphrates River, Jordan River, Tigris River, Suez Canal, Persian Gulf, Strait of Hormuz, Arabian Sea, Red Sea, and the Gaza Strip. Highlight those listed and add any that are not.