Comparing Latin American Economies

Mexico, Brazil, & Cuba

Unit 6 Notes

Foreign Exchange Rates

The price of 1 country’s currency compared to another…– 1 US dollar = 11 Mexican pesos– 1 US dollar = 1.8 Brazilian reals– 1 US dollar = .92 Cuban pesos

United Mexican States

3 Economic Questions…What to Produce?– Businesses decide and government approves/denies it

How to produce it?– Businesses decide & government regulates procedures

For whom to produce?– Businesses decide based on supply & demand (price)

Which economic system does Mexico have?…

Mexico’s Economic System

Mexico has a Mixed economic system, that is closer to market than command.

Mexico’s Natural Resources

What’s available?– petroleum, silver, copper, gold, lead, zinc,

natural gas, timber

Mexico’s Land Use

What percentage of the land is arable (capable of being farmed)?– 12.66%

Mexico’s Industries

What’s being produced in the factories?– food and beverages, tobacco, chemicals, iron and

steel, petroleum, mining, textiles, clothing, motor vehicles, consumer durables,

– Tourism is also a major industry in Mexico.

Mexico’s Literacy Rate

What percentage of people over the age of 15 can read and write?– 91%

How long are students required to stay in school?– 13 years

Mexico’s Unemployment Rate

What percentage of people do not have jobs?– 4.1% (however, only 61.1% of people

working age have a job)

What percentage of people live in poverty?– 18.5%

Mexico’s GDP

$1.578 trillion (2008)

GDP Per Capita--What is the value of goods and services produced per person?– $14,400 (2008)

Federative Republic of Brazil

3 Economic Questions…What to Produce?– Businesses decide and government approves/denies

it

How to produce it?– Businesses decide & government regulates

procedures

For whom to produce?– Businesses decide based on supply & demand (price)

Which economic system does Brazil have?…

Brazil’s Economic System

Brazil has a Mixed economic system

Brazil’s Natural Resources

What’s available?– bauxite, gold, iron ore, manganese, nickel,

phosphates, platinum, tin, uranium, petroleum, hydropower, timber

Brazil’s Land Use

What percentage of the land is arable (capable of being farmed)?– 6.9%

Brazil’s Industries

What’s being produced in the factories?– textiles, shoes, chemicals, cement, lumber,

iron ore, tin, steel, aircraft, motor vehicles and parts, other machinery and equipment

Brazil’s Literacy Rate

What percentage of people over the age of 15 can read and write?– 88.6%

How long are students required to stay in school?– 14 years

Brazil’s Unemployment Rate

What percentage of people do not have jobs?– 8%

What percentage of people live in poverty?– 22%

Brazil’s GDP

$2.03 trillion (2008)

GDP Per Capita--What is the value of goods and services produced per person?– $10,300 (2007)

Republic of Cuba

3 Economic Questions…What to Produce?– Government makes all economic decisions

How to produce it?– Government decides how to make goods/services

For whom to produce?– Whoever the government decides to give them to

Which economic system does Cuba have?…

Cuba’s Economic System

Cuba has a Command economic system

Cuba’s Natural Resources

What’s available?– cobalt, nickel, iron ore, chromium, copper,

salt, timber, silica, petroleum, arable land

Cuba’s Land Use

What percentage of the land is arable (capable of being farmed)?– 27.63%

Cuba’s Industries

What’s being produced in the factories?– sugar, petroleum, tobacco, construction,

nickel, steel, cement, agricultural machinery, pharmaceuticals

Cuba’s Literacy Rate

What percentage of people over the age of 15 can read and write?– 99.8%

How long are students required to stay in school?– 16 years

Cuba’s Unemployment Rate

What percentage of people do not have jobs?– 1.8%

Cuba’s GDP

$144.6 billion (2008)

GDP Per Capita--What is the value of goods and services produced per person?– $12,700 (2008)

Canada’s Economy

What do you like on a Sundae?

What toppings do you like on an ice cream sundae?– Plain Vanilla?

– Or absolutely everything (and I mean everything)?

OR…

What do you like on a Sundae?

Chances are, you were somewhere between plain and everything.– When discussing economies, most countries

are somewhere in between too.

When a country is not completely a command economy and not completely a market economy, but somewhere in between, it is called a Mixed Economy.

Most countries lie somewhere in between-However, they may be closer to one

side than the other

Review Types of Economies1. Which type of economy lets businesses do whatever they want?

2. Which economy has the government making all the decisions?

3. Which economy do most countries have?

3 Economic Questions…

What to Produce?– Businesses decide and government approves/denies it

How to produce it?– Businesses decide & government regulates

procedures

For whom to produce?– Businesses decide based on supply & demand (price)

Which economic system does Canada have?…

Canada’s Economic System

Canada has a Mixed economic system– It’s actually pretty close to a Market economy;

however, there is some government regulation among industries

– It does have Free Enterprise (competition between businesses)

Canada is economically strong!

Mixed EconomyCanada is a mixed economy, but it is closer to market than command

Canada’s Foreign Exchange Rate

The price of 1 country’s currency compared to another…– 1 US dollar = 1.01 Canadian dollars– 1 US dollar = .75 EU euros– 1 Canadian dollar = .7501 EU euros

What does this mean?– The US economy is a little stronger than

Canada’s; however, the economy of the European Union is stronger than both!

Canada’s Natural Resources

What’s available?– Minerals like: iron ore, nickel, zinc, copper,

gold, lead, molybdenum, potash, diamonds, and silver,

– fish, timber, wildlife, coal, petroleum, natural gas, hydroelectric power

Canada’s Land Use

What percentage of the land is arable (capable of being farmed)?– 5% (only in Southern Canada; Northern Canada’s

terrain is permafrost!)– This is actually a large amount, considering Canada

is the world’s 2nd largest country

What are the major agricultural products?– Wheat, barley, oilseed, tobacco, fruits, vegetables,

dairy products, forest products, fish

Canada’s Industries

What’s being produced in the factories?

– Transportation equipment, chemicals, processed and unprocessed minerals, food products, wood and paper products, fish products, petroleum, natural gas

Which country is Canada’s biggest trading partner?

Exports: US 77.7%, UK 2.7%, Japan 2.3%Imports: US 52.4%, China 9.8%, Mexico 4.1%

Canada’s Literacy Rate

What percentage of people over the age of 15 can read and write?– 99%

How long are students required to stay in school?– 17 years

Canada’s Unemployment Rate

What percentage of people do not have jobs?– 8.3%

What percentage of people live in poverty?– 10.8%

Canada’s GDP

$1.336 trillion (2009)– 15th in the world

GDP Per Capita--What is the value of goods and services produced per person?– $38,100 (2009)

4 Factors That Effect Canada’s GDP

Human Capital: Canada is investing in education & training (check out literacy rate!)Capital Goods: Canada is investing in new technology & building new factoriesAbundant Natural ResourcesEntrepreneurship

North American Free Trade Agreement

Signed by the US, Canada, & Mexico in the mid-1990sEliminated trade barriers between the 3 countriesFree Trade between the 3 countriesHow has it affected Canada’s economy?– It eliminated trade barriers with US & Mexico, and

allows them to trade more freely at a better cost

Canada’s Economic ProblemsUnemployment & poverty

Over-depletion of natural resources

Acid rain from factories near Great Lakes region is destroying timber resources

Improving public services (which forces the country to raise taxes)