Chapter 2 Economic Systems and Decision Making Evaluating Economic Performance Page 43

7 Major Economic and Social Goals • Economic Freedom – Individuals like to choose their own occupations, employers, and uses for their money.

– Business owners like the freedom to choose where and how they produce.

7 Major Economic and Social Goals • Economic Efficiency – Resources are scarce and the factors of production must be used wisely so more wants and needs can be satisfied.

7 Major Economic and Social Goals • Economic Equity – Equal pay for equal work ; it is illegal to discriminate on the basic of age, sex, race, religion, or disability in employment.

– Minimum wage; lowest legal wage that can be paid to most workers.

– Advertisers should not be allowed to make false claims about their products.

7 Major Economic and Social Goals • Economic Security – Protection from layoffs and illnesses (unemployment, workman’s comp, & personal insurance) – Social Security federal program of disability and retirement benefits for most workers – Medicare health insurance for persons 65 or older

7 Major Economic and Social Goals • Full Employment – Working people earn income producing goods and services for others.

– Non working people cannot support themselves or their families, or produce output for others.

7 Major Economic and Social Goals • Price Stability – If inflation occurs a rise in the general level of prices happens and workers need more money to pay for food, clothing, and shelter.

– People on a fixed income find bills harder to pay – High rates of inflation can discourage business activity.

7 Major Economic and Social Goals • Economic Growth – People hope to get a better job – A newer car – Their own home – Overall growth enables more people to have more goods and services

Possible future Goals • • • Cleaner Environment Preservation of endangered Species We decide on what goals that are most important to us and it is possible that our goals could change in the future.

Trade – Offs Among Goals • • • A goal of full employment could work against individual freedom of people in the choices of products to purchase Increasing minimum wages could lead to less people being hired Government reflects the will of the majority and helps created policies that achieve goals that society wants.