Warm-Up/Check on Learning Exercises •I do not grade notes, but I will take grades on warm-ups and check on learning exercises. Have a page dedicated to warm-ups and check on learning that way at the end of the week you can turn it in. It will be graded as a non-test grade and evaluated based on understanding and completion. Each day is worth 20 points, I do not do partial grading, so if Tuesday is not complete, you receive 0 points for that day. If you were absent a day write the day you were absent on your sheet.
Transcript
Warm-Up/Check on Learning Exercises• I do not grade notes, but I will take grades on warm-ups
and check on learning exercises. Have a page dedicated to warm-ups and check on learning that way at the end of the week you can turn it in. It will be graded as a non-test grade and evaluated based on understanding and completion. Each day is worth 20 points, I do not do partial grading, so if Tuesday is not complete, you receive 0 points for that day. If you were absent a day write the day you were absent on your sheet.
What you will do in economics• Examine: how individuals , businesses, governments, and societies
chose to use scarce resources to satisfy their wants
• Organize, interpret, and analyze data about economic behaviors
• Develop theories about how the economy works
What is economics?The study of how individuals and societies satisfy their unlimited wants
with limited resources
Scarcity• The situation that exists because wants are unlimited and resources
Why does scarcity matter?• YOU confront the issue of scarcity constantly!
• COL Activity #1• Wants • Resources
Check on Learning #1 • Write down one way you face scarcity
• Find a person in this class that has a different example than you and write it down
• Repeat above
• In a complete sentence write the 3 examples of how society faces scarcity
• Sentence stem: I face scarcity by _______. Others face scarcity by _______, and ____________.
Your Examples of scarcity
Warm-Up #2 • What is a principle?
• a fundamental truth or proposition that serves as the foundation for a system
Principles of Economic Thinking• Principle 1: SCARCITY FORCES TRADEOFFS-wants are unlimited/resources are limited-Tradeoff = giving up one thing to get another
Free lunch/summer examples
TIME IS AN INDIVIDUALS MOST SCARCE RESOURCE
Principles of Economic Thinking• Principle 2: Costs vs. Benefits• Individuals make choices based on the expected costs and benefits• Cost=what you spend in time, money, effort, and other sacrifices• Benefits=what you gain
COL#2• Creating a cost benefits analysis: Write 1 cost(-) and 1 benefit(+) for
each of the following• Riding a bike instead of driving a car• Sleeping an additional hour • Find 1 classmate near you that has a different cost and benefit• Repeat
Riding a bike vs Driving a car• Costs • Benefits
Sleeping an additional hour• costs • benefits
Production Possibilities Curve•Production Possibilities Curve is an economic model
that shows how an economy might use its resources to produce two goods
• The graph shows all possible combinations using the available resources and technology fully
•Graph factors in the three factors of production: land, labor, and capital
•Page 30 in book
Warm-Up #3• Yesterday we learned about trade-off
• Write in a complete sentence a trade-off that you recently made
• Talk with someone around you about your trade-off
Production Possibilities Curve• Page 30• Figure 2.5a• Straight line means the opportunity cost/tradeoff is equal at every
point on the graph
• The line shows the most efficient tradeoff
Production Possibilities Curve• Figure 2.5B• Curved line means that the opportunity cost/tradeoff is greater at
some points on the graph
• Attainable goals are inside the curve, unattainable outside the curve
Production Possibilities Curve• Figure 2.5c
• Changes in productivity/economy can shift the curve• -positive change=shift to the right/up• -negative change=shift to the left/down
COL#3 • You are going to create your own production possibility curve
• Chose 2 things you want to produce and create a labeled PPC(create your own numbers)
• Chose any point on your PPC that you want to produce at and write a sentence explaining why.
I want to produce ___ of product 1 and ___ of product 2 because
PPC Recap
Warm-Up• What is an incentive • Write down an example of positive incentive• Write down an example of a negative incentive• Find a class mate with a different positive and negative incentive• repeat
• Write a complete sentence explaining why one of your examples is an incentive
Positive Incentives
Negative Incentives
Principles of Economic Thinking• Principle 3: Incentives Matter• Incentive-something that motivates a person to take a
particular course of action-people respond to incentives in generally predictable ways-Two forms: positive and negative
-positive incentive: grades in school-negative incentive: jail time for breaking the law
3 Basic Economic Questions• All economic systems must answer these 3 basic questions1) What will be produced?2) How will it be produced?3) Who will it be produced for?
How each economic system answers these questions is what makes them unique
Economic Systems• Economic system- a society’s way of coordinating the production and
consumption of goods and services• Producer- a person/firm that makes goods and/or services• Consumer- a person that buys goods and/or services for personal use
• Economic systems exist to combat scarcity
• 3 types• -Capitalism• -Socialism• -Communism
Brochure Project
Expert Group Exercise• You will need to know(write in your notes) the property rights,
incentives(to work), economic freedom(is there any), competition(does any exist), and the governments role for your assigned economic system
• Talk in your groups about the possible answers
• This should take about 7 minutes, then we will switch information cards.
Economic Systems T Chart• Collaborate with someone next to you and develop a t chart or venn
diagram of how the 3 different economic systems answer the 3 basic questions(YES, put the chart in your notes, you may see it again on the test)
US Free Enterprise System• Free enterprise system: an economic system in which the means of
production are mostly privately owned and operated
• What we already know(work with your partner and write an example of each in your notes)• Incentives• Private property• Economic freedom• Competition• Limited role of government• Influenced by various economic philosophers
US Free Enterprise System Characteristics• property is privately owned by individuals or businesses as opposed
to government ownership• the primary incentive is for businesses to make a profit.• individuals are free to make economic choices and decisions based on
individual preferences and desires.
US Free Enterprise System Characteristics• competition is intended to produce the best product at the lowest
price• government interference in the economy is limited, yet government
protects property rights as expressed in the Constitution and manages business cycles through monetary and fiscal policies
Benefits of the US Free Enterprise(Capitalist) System• Freedom of consumers – consumers have the ability to purchase the
goods and services they choose, making their wishes known to producers through voluntary transactions.
Benefits of the US Free Enterprise(Capitalist) System• Freedom of producers – can produce what they want in order to
respond to consumer demand and make a profit.
• Variety of goods – the free enterprise system produces a wide variety of goods and services to meet consumers’ wants and needs.
Benefits of the US Free Enterprise(Capitalist) System• Responsive prices – prices in a free enterprise system respond to
changes in supply and demand, thus signaling producers and directing resources to respond to consumer demand.
Benefits of the US Free Enterprise(Capitalist) System• Investment opportunities – businesses can redirect resources from
being consumed today in order to create benefits in the future.
• Creation of wealth – sale of goods and services along with investment allows for profit and accumulation of wealth.
RECENT CHANGES IN THE BASIC CHARACTERISITICS OF THE UNITED STATES ECONOMY
• There are 4 passages describing different recent different changes in the US economy. Read and summarize(about 2-4 sentences) each of the four passages in your notes. You may, or may not, work with a(1) partner • Tip in summarizing: answer the W’s• Who- does it effect• What- is the change• Where- United States• When- did the change happen• Why- did the change occur
Economic Philosopher Project
Outsourcing
Bush Tax Cuts
Healthcare Reform
International Trade
Circular Flow Model
• A diagram that shows the circular movement of money, resources, and goods and services among households and producers in an economy.
Real World Examples• Real world examples Daniel applies for an after-school job at a
restaurant. This is the supplying of labor in the factor market; his wages will be a cost to a business, and income to a household.• Daniel uses some of his earnings to buy tennis shoes at the mall. This
is the purchase of goods in the product market; the payment for the shoes is revenue to a business, and consumption spending for a household.
Real World Examples• A farmer sells his crop of corn in the factor market. A processing
company buys it and turns it into packages of frozen corn. The packages of corn are then purchased by households to feed their families.
HOW GOVERNMENT ACTIONS AFFECT THE CIRCULAR-FLOW MODEL• Government can be added to the circular-flow model as both a
producer and consumer.
HOW GOVERNMENT ACTIONS AFFECT THE CIRCULAR-FLOW MODEL• Purchases goods and services in the product market• Purchases factors of production in the product market• Furnishes goods and services
HOW GOVERNMENT ACTIONS AFFECT THE CIRCULAR-FLOW MODEL• Collects taxes from both households and businesses• Transfers money to households and businesses
HOW THE CIRCULAR-FLOW MODEL IS AFFECTED BY THE REST OF THE WORLD
