LEARNING TARGETS To understand the concept of scarcity, and give real-world examples of it. To understand and give real-world examples of the definition of Economics To be able to identify real-world examples of Allocation of Resources.

Introductory Econ Ideas Fundamental issue is Scarcity Something must always be given up T.I.N.S.T.A.A.F.L.

Economics: Study of limited resources trying to satisfy unlimited wants People always want more Pig Principle

3 Questions 3 Big Questions all economies must answer: What to produce? How to produce it? For whom is it being produced?

ALLOCATION of RESOURCES If we assume resources are scarce, how do people, societies, or countries ALLOCATE, or distribute, those resources?

Allocation of Resources Econ is not about eliminating scarcity, it’s about dealing with it.

Random Draw Lottery Ex. Drawing for shelter beds, Vietnam Draft?, Powerball FYI: Your odds of winning the Powerball are 1 in 950,000,000

Personal Characteristic Age, weight, ancestry, alphabetical by name Ex. Soc. Sec. benefits, hearts, choosing your fantasy football team FYI: There are only 450 total roster spots in the NBA

Performance Based By score, race results, Qty. of sales, # of push-ups Ex. Grades, Promotions, awards

First Come First Served Whoever’s there first Ex. Stop signs, many goods in the former USSR, most legal immigration to the US

Fiat By choice of the those that own the resource Ex. Most of what parents give to children, a country’s dictator, teacher

Voting Majority rule Many government decisions, Prom royalty

Willingness and Ability to Pay The amount of cash, goods, or services you are willing to sacrifice Ex. Most everything in the market economy

Other Combination of others

Allocation Systems Random Personal Characteristics Performance Based 1st come, 1st served Fiat Voting Willing and Able

Importance of allocating scarce resources LEARNING TARGET- To identify and give real-world examples of the 4 Factors of Production Scarcity of Productive Resources a.k.a. Factors of Production Produce Goods and Services Satisfy society’s wants -Human, Capital, Natural, and Entrepreneur

Human AKA - Labor People with their mental and physical abilities

Capital Items that aid production Ex. Tools, machines, factories

Natural Resources AKA - Gifts of Nature Anything we canNOT make ourselves

Entrepreneur The coordinator, the risk-taker Ex. *This is a very important part of our free-market economy

In-class activity You are to pick an item and describe/show the productive resources that go into this item. Do this by putting an image of your good into the middle of a piece of blank paper with a label. Then in each corner place in image of some of the resources that go into this good (for example one corner will have a drawing of workers with a written description of the workers and the impact on this good).

Do this by yourself first, then share with your partner, then share with 1 other pair.

In your small groups, pick an item (good) and discuss the 4 Factors of Production that go into it.

Journal #1 NPR Poverty Article After listening to the piece, respond to the following: How do you feel we should define “poverty”? What new economic knowledge did you take from this piece?