Standard 12.2

12.2 Students analyze the elements of America’s market economy in a global setting:

Section 1. Understand the relationship of the concept of incentives to the law of supply and the relationship of the concept of incentives and substitutes to the law of demand.

Section 2. Discuss the effects of changes in supply and/or demand on the relative scarcity, price, and quantity of particular products.

Section 3. Explain the roles of property rights, competition, and profit in a market economy.

Section 4. Explain how prices reflect the relative scarcity of goods and services and perform the allocative function in a market economy.

Section 5. Understand the process by which competition among buyers and sellers determines a market price.

Section 6. Describe the effect of price controls on buyers and sellers.

Section 7. Analyze how domestic and international competition in a market economy affects goods and services produced and the quality, quantity, and price of those products.

Section 8. Explain the role of profit as the incentive to entrepreneurs in a market economy.

Section 9. Describe the functions of the financial markets.

Section 10.Discuss the economic principles that guide the location of agricultural production and industry and the spatial distribution of transportation and retail facilities.