Transcript unit 4 - concept 1 specialization

Concept #1 - Specialization
• Lesson Objective Questions:
• To what extent should a developed nation trade with a less developed nation?
• Vocabulary –
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Absolute Advantage
Comparative Advantage
Exports
Imports
DC
LDC
International Trade and Foreign Exchange
• Copy and Answer in Binder –
• Define International Trade
• Define Foreign Exchange
• How do these two concepts interact?
Warm up: Where is your stuff from?
• Find 10 items on your persons, write down what they are, where they
come from, and answer the following question in your binder:
• How does global trade affect your life?
Where was your stuff made??
• Step #1: Using your country list and label countries represented. USE
TEXTBOOK OR PHONE
• Step #2: Group colored countries into categories based on the type of
items the US receives from them. Create a key of similar items
(clothing, electronics, food).
• Step #3: Write a statement explaining why you believe we receive
different types of goods from different parts of the world. (IN YOUR
BINDER)
• Step #4: Answer the question at the bottom of the map
THINK/PAIR/SHARE – COPY AND ANSWER THE
QUESTION BELOW IN YOUR BINDER.
Why do you think we receive different
types of goods from different parts of
the world?
Trading Game
• You are going to participate in a hypothetical trading game. Each group will
be assigned a different country: United Kingdom, China, Colombia, Saudi
Arabia and Ghana.
• Each student will be given a card with a different country listed. Once every
student has their card, you need to find the rest of your group and sit with
them.
• Each group will be given a random set of ten trading cards
• The objective of the game is for each group to get the most points by
trading their country’s goods for products from another country.
• It is a “free trade” meaning any country can trade with another country,
and any item and/or amount of product can be traded for another.
• You can creatively market your products or combine the to end up with
something more desirable.
Round #1 – TEN MINUTES
• EXPORTS –
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Gold – 5 points per unit
Oil – 4 points per unit
Lumber – 3 points per unit
Electronics – 2 points per unit
Coffee – 1 point per unit
Round #2 – TWO MINUTES
• World Situation – The world is running out of oil, making oil extremely
rare and much more expensive.
• Outcome – The worth of oil increases by two points.
• NEW EXPORTS –
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Oil – 6 points per unit
Gold – 5 points per unit
Lumber – 3 points per unit
Electronics – 2 points per unit
Coffee – 1 point per unit
LET’S SEE WHO WON!!!
• EACH COUNTRY MUST RETURN TO THEIR TABLE AND TALLY UP THEIR
POINTS.
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UK?
CHNA
COLOMBIA
SAUDI ARABIA
GHANA
• NEW WORLD SITUATION – GHANA LEARNS TO MAKE COUNTERFEIT
ELECTRONICS, MAKING ITS ELECTRONICS CHEAPER. OUTCOME –
GHANA TAKES ONE ELECTRONIC UNIT FROM EACH COUNTRY.
• RE-TALLY POINTS
WRAP-UP QUESTIONS
• ANSWER IN COMPLETE SENTENCES. TURN INTO BIN WHEN FINISHED
• Did any countries end the game richer or poorer than they started?
• What was it like to be a rich country? A poor country?
• Was it easy or difficult to trade? Why?
• Did any countries feel especially powerful or powerless?
• Which items were most popular? Which were least popular? Why?
THINK/PAIR/SHARE – COPY AND ANSWER THE
QUESTION BELOW IN YOUR BINDER. WORK WITH A
NEW PARTNER.
WHY DO
PEOPLE TRADE?
Voluntary Trade to Gain Something-Wealth!
International Trade:
Basic Concepts
(USE GUIDED NOTES CHART)
• Specialization
• Absolute Advantage
• Comparative Advantage
Concept 1 - Specialization
• Definition: Focusing on what you can make extremely well
and at the cheapest price  the most efficient
• Leads to:
• Greater Productivity – making more g/s
• Higher Standard of Living – have more money to make
your life better
• Economic Interdependence – relying on other countries
for goods and services
International Trade and Comparative
Advantage
• Copy and Answer in binder –
• Where is Mr. Clifford?
• Define Comparative Advantage.
• How does the concept of comparative advantage interact with international
trade?
Concept #2:Absolute Advantage
• Definition: The ability to produce more of a good or service using the least
amount of resources
• Leads to: Greater Productivity
• Example: I can fix cars and mow the lawn better than you. I have the
absolute advantage in both regards.
In your notes
answer, Which
country has the
absolute
advantage?
Concept #3: Comparative Advantage
• Definition: The ability to produce the good/service with the least opportunity
cost.
Calculating opportunity cost (the next best alternative)
• Opportunity cost of producing Good A = the number of Good A produced in a
unit of time divided by the number of Good B produced in the same unit of time.
Good A= Good A/Good B
Country A Opportunity Cost
1 Food= ½ Clothing
1 Clothing= 2 Food
What should Country A Specialize in? Country B?
Country B Opportunity Cost
1 Food= 2 Clothing
1 Clothing= ½ Food
THINK/PAIR/SHARE – COPY AND ANSWER THE
QUESTION BELOW IN YOUR BINDER. Pick a 3rd Partner
WHY TRADE?
Countries can specialize in what they have the comparative
advantage in and trade  more g/s for all!
Brainstorm – Work with a
th
4
Partner
• Why should developed and less developed countries trade?
• Come up with at least 3 reason.
Trade benefits countries because it
creates…
• More efficient use of
resources
• Higher Quality
• Lower prices
• Increased consumption
• Increased standard of living
• More choices
Let’s Practice Absolute & Comparative
Advantage
• Find comparative and absolute advantage in the scenarios.
Worksheet
Exit Ticket – Assessment and Summarization
• Read the Assessment and complete the activity
• On the back of your assessment worksheet copy and answer:
Why should developed and less developed countries trade?
Homework
• Study for Concept #1 Quiz
• Work on Binder
Concept #1 – Specialization
Quiz
All Quiz Expectations Apply