Transcript Section 3 and the review - Valley View School District

The Beginning
CHAPTER 1 ECONOMICS: LABOR
OF LOVE
We want everything for free!
 Free T shirts at college
 Free samples at Sam’s Club
 BOGO tan
 Is there such a thing as “FREE”?
 There is no such thing as a free lunch?
 Very few things in life are free. CLEAN air isn’t
free!
 Some where along the lines someone paid for
it!!!
TINSTAAFL
 Foreign Language or acronym?
 Stands for: THERE IS NO SUCH THING AS A
FREE LUNCH!!
PROBLEMS? IN THE US?
 What could be the biggest problem in the
United States?
 Money?
 NO!
 Scarcity, the condition that arises because
society does not have enough resources to
produce all the things that people need and
want!
What things are scarce?
Let’s all be millionaires!
What would we buy?
Would we work?
Would there be enough of goods and services?
Money=no goods to buy=worthless
Bread more valuable than money?
Factors of Production
 1. Land, natural resources not created by
human effort
 Examples:
 Enough of beaches for everyone to vacation at
once?
 2. Capital, tools equipment and factories used
in the production of good and services
 It is a result of production
 Examples?
 3. Labor, the people with all their abilities,
skills and efforts
 Can change, how? Why?
 4. entrepreneurs, the risk takers in our society
 The people who open their own business and
take a chance at losing big
 THEY ARE THE DRIVING FORCE OF OUR
ECONOMY!
SECTION 2
More and more fun!! Can it get any better???
WANT WANT WANT WANT
 Can we have everything that we want?
 Who has EVERYTHING that they want?
 Life is not fair???
 Sometimes we have to make alternative
decisions called trade-offs
 Could involve spending or time
 Make quick decisions or based on criteria
 Football game?
What should I do???
 Go to the football game or go to work? That is
the question. Well lets think about
consequences with a decision making grid
 They are helpful because they force you to
consider a number of relevant alternatives
AND CRITERIA you are basing your decision
on
You can do that but it will
cost you!!!!
 When you make a decision there is an
opportunity cost
 Cost means more than a price tag, if your late
for class what’s the cost?
 It is an alternative that is given up
 Wake up late for job and don’t go,
opportunity cost of staying home is the oney
lost from work!
I don’t understand
 Economists find it easy to explain opportunity
costs with a production possibilities frontier
 A diagram representing various combinations
of goods/services an economy can produce
when all productive resources are fully
employed
Chapter 1
SECTION 3 AND THE REVIEW
I WANT WANT WANT WANT WANT
 IS IT FEASIBLE TO HAVE ALL WE WANT AND




NEED?
WHAT IS THE DIFFERENCE BETWEEN A
WANT AND A NEED?
NEED IS A BASIC REQUIREMENT FOR
LIVING
A WANT IS A MEANS TO EXPRESS A NEED
EXAMPLE: I WANT A PIZZA SATISIFIES A
NEED FOR FOOD
HOW DO WE FEED OUR WANTS AND
NEEDS?
 ARE THERE HIGHER LEVELS OF NEEDS?
 HUMAN ATTENTION
 KNOWLEDGE
 ECONOMICS IS CONCERNED WITH ECONOMIC
PRODUCTS, GOODS AND SERVICES THAT ARE
USEFUL, RELATIVELY SCARCE AND
TRANSFERABLE TO OTHERS
TYPES OF ECONOMIC PRODUCTS
 A GOOD, IS AN ITEM THAT IS ECONOMIC
USEFUL OR SATISFIES AN ECONOMIC
WANT, SUCH AS A BOOK OR CAR
 A SERVICE, IS SOMETHING THAT IS
PERFORMED BY SOMEONE ELSE
 FOR EXAMPLE, A HAIRCUT, OR HOME REPAIRS
TWO TYPES OF GOODS
 CONSUMER GOODS, ARE INTENDED FOR
FINAL USE BY THE INDIVIDUAL
 CAPITAL GOOD, IS A GOOD USED IN THE
PRODUCTION FOR ANOTHER GOOD OR
SERVICE
 DURABLE GOOD, IS A GOOD THAT LASTS
THREE YEARS OR MORE
 NONDURABLE, DUH THE OPPOSITE
WE ARE ALL CONSUMERS
 CONSUMERS INDULGE IN THE PROCESS OF
CONSUMPTION, OR USING UP GOODS AND
SERVICES TO SATISFY THEIR WANTS AND
NEEDS
 THEY ARE IMPORTANT BECAUSE WITHOUT
THEM THE MARKET WOULD CRASH
 WHEN WE PURCHASE SOMETHING, WE
VOTE AND ITS POPULARITY
VALUE=$, OR DOES IT????
 IN ECONOMICS WE REFER TO VALUE AS
SOMETHING IN DOLLARS AND CENTS
 WHY ARE SOME THINGS MORE EXPENSIVE
THAN OTHERS?
 PARADOX OF VALUE, WHAT APPEARS TO BE
FASLE IS ACTUALLY TRUE
 NECESSITIES SUCH AS WATER HAVE LITTLE
MONETARY VALUE, YET A DIAMOND RING IS HIGH
IN VALUE. WHY???????
 IN A NUTSHELL, SCARCITY IS REQUIRED FOR
VALUE
TO HAVE VALUE YOU NEED???
 FOR SOMETHING TO HAVE VALUE IT MUST
HAVE:
 1. UTILIITY, TO BE USEFUL OR TO PROVIDE
SATISFACTION
 CAN THAT VARY???
 2. SCARCITY, YOU CAN’T BUY IT ON THE STREET
I WANNA BE RICH, LAAA LAAA
LAAA!!!
 OH TO BE RICH, EVERYONE WANTS TO
HAVE WEALTH RIGHT??
 WEALTH, IS THE ACCUMULATION OF
THOSE PRODUCTS THAT ARE SCARCE,
TANGIBLE, USEFUL AND TRANSFERABBLE
FROM ONE PERSON TO THE NEXT
HOW DO I GET WEALTHY??
 WEALTH IS MADE POSSIBLE BY THE
CIRCULAR FLOW OF ECONOMIC ACTIVITY
 WHEN BUYERS AND SELLERS IN A MARKET
EXCHANGE CERTAIN PRODUCTS
 WE GET ECONOMIC GROWTH WHEN THE
TOTAL OUTPUT OF GOODS AND SERVICES
INCREASES OVER TIME
KEY FACTORS IN ECONOMIC
GROWTH
 EFFECTIVE MARKET
 PRODUCTIVITY, A MEASURE OF THE
AMOUNT OF OUTPUT PRODUCED BY
GIVEN AMOUNT OF UINPUT IN A SPECIFIC
TIME
DIVISION OR LABOR AND
PRODUCTIVITY???
 HOW CAN AN ASSEMBLY LINE WORK
BETTER THAN EVERYONE HAVING TEN
JOBS???
 SPECIALIZATION, EVERYONE GETS BETTER
AT ONE JOB RATHER THAN THREE
 HUMAN CAPITAL, SUM OF THE SKILLS,
ABILITIES, HEALTH AND MOTIVATION OF
PEOPLE
ARE WE DEPENDENT ON ASIA,
GERMANY??
 YESSSSSSSSS, WE ARE ECONOMICALLY
INTERDEPENDENT, MEANING WE RELY ON
OTHERS FOR GOODS AND SERVICES AND
THEY RELY ON US
 EXAMPLE ANYONE?????
REST OF THE WEEK
 WORK ON HOT DOG STANDS
 CURRENT EVENTS FIRDAY AND REVIEW
 TEST ON TUESDAY
 BUSINESS PLAN STUFF ????