Economy In Africa

BY: CLAIRE FREDERICK

Traditional Economy
A Traditional Economy is known for how the

economy uses barter and trade. These types of

economies are usually found in more rural, farmbased areas of the world.

Command Economy
A command economy is run by the government and

the government gets to decide all the factors of

production. Usually this economy is found in a
dictatorship or anarchy.

Market Economy
This is the type of economy most countries use,

including the United States. Both the government

AND the people get to decide the three factors of
production. This economy can also be referred to as a
mixed economy.

The Three Factors of Production

1) What to Produce

2) For Whom Will It Be Produced

3) How It Will Be Produced

All Economies must follow these three factors of

production to make sure that everything turns out

right.

Economic Scale
All countries fall on the economic scale. At zero you

have a pure command economy and at 100 you have

a free market economy. Free market differs from
market. Free market is when the citizens control all
aspects of the government. A mixed economy can be
found in the middle for all is pretty much equal in
this type of economy.

Nigeria and South Africa: Compare And Contrast

Nigeria

South Africa

Federal Republic

Republic

68% Literacy Rate

86% Literacy Rate

177 Million Population

52 Years Life Expectancy
Exports: Oil, Cocoa,

Rubber, Petroleum
24% Unemployment
Rate

48 Million Population
49 Years Life Expectancy
Exports: Gold,

Diamonds, Platinum
25% Unemployment
Rate

Specialization
Specialization is when a country specializes in one

thing that they are very good at making. That

country then trades with another with a
specialization in a different product. This can really
benefit a countries economy.

Trade Barriers
Trade barriers are pretty much based on the word.

They are barriers that limit trade between two

countries. There are three very important trade
barriers:
Quota: Limit on Imported Goods
Tariff: A Tax of Imported Goods
Embargo: Block of Goods From a Country

Why Do We Need an Exchange Rate?

Exchange Rates are used to make trading between

other countries easier and so countries with different

currencies can trade more often.