Chapter 1 Unit 2 and 3

1. What economic term is being represented in this photo?2. How could the value of medicine be influenced by this?3. What other factors can influence the value individuals and businesses place on a good or service?

There’s more.As you saw on the last slide, scarcity, or

even the illusion of scarcity plays a major role in our decision making. There are so many other factors at play though.

Describe your favorite grocery store. (Reference to “Grocery Store” Handout)

Making the best decisionWhere do you like to shop?What sorts of questions go through your mind

while shopping?You should be considering:

Opportunity cost- value of the next best alternative given up.

Trade-offs- alternative that must be given up when one choice is made rather than another.

Production possibilities curve

Consumerism- a social movement that was aimed at promoting the interest of consumers.

5 consumer rights-Right to Safety-Right to be Informed-Right to Choose-Right to be Heard-Right to Redress

Unit 3Economic Growth- increase in a nation’s total

output of goods and services over time.

Productivity- measure of the amount of output produced in a specific time period with a given amount of resources.

Human CapitalHuman capital- sum of people’s skills,

abilities, health, and motivation. See figure 1.8Division of labor- division of work into

a number of separate tasks to be performed by different workers.

Specialization- assignment of tasks to the workers, factories, regions, or nations that can perform them most efficiently.

1. Factor Markets- market in which productive resources are bought in sold. (you participate in this market when you sell your labor for the wages you earn)2. Product markets- market in which goods and services are bought and sold.