An Introduction to Economics #2

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Introduction to Economics

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Presentation transcript:

An Introduction to Economics #2 Unit 1 Economics An Introduction to Economics #2

Essential Questions: Explain the difference between Macro and Micro Economics Explain the theory of the Possibilities Curve using yourself as an example

Basic Concepts Macroeconomics– examines the decisions of large sectors, government, or the economy as a whole (aggregate). Microeconomics– deals with economic decision making of individuals, smalls firms, or small units.

Micro vs. Macro Economics https://www.youtube.com/watch?v=DJG-liA19eY

Factors of Production (Scarce Resources) Land - natural resources of “gifts of nature” Labor - physical and mental talents of workers Capital - tools, machinery, manufactured goods used to produce consumer goods Investment Entrepreneurial Ability - the idea or “sparkplug”, innovation, risk

The Four Factors of Production https://www.youtube.com/watch?v=hG9PQHD5ROA

Production Possibilities Curve The Production Possibilities Curve (ppc) shows the maximum combination of goods and services that can be produced from a given amount of resources. Assumptions Full Employment Fixed Resources Fixed Technology Two Goods Consumer Goods (Pizzas) Capital Goods (Industrial Robots)

Production Possibilities Curve #1 https://www.youtube.com/watch?v=tW4G5IPpzFY

Production Possibilities Curve #1 Practice Time!! Listen, then pause the video clip when he asks you to do the calculations on your own. Write the answers on your paper, then “unpause” to see if you got it right  https://www.youtube.com/watch?v=O6XL__2CDPU

Production Possibilities Table Robots Pizza 10 0 9 1 7 2 4 3 0 4

Production Possibilities Model Production Possibilities Curve A’ 14 13 12 11 10 9 8 7 6 5 4 3 2 1 G 1.1 B’ Unattainable A Economic Growth B C’ C Industrial Robots D’ D Now Attainable Attainable E E’ 0 1 2 3 4 5 6 7 8 9 Pizzas

Production Possibilities Model Production Possibilities Curve A’ 14 13 12 11 10 9 8 7 6 5 4 3 2 1 B’ Unattainable A Law of Increasing Opportunity Cost B C’ C Industrial Robots D’ Shape of the Curve D Attainable W 1.2 E E’ 0 1 2 3 4 5 6 7 8 9 Pizzas

Production Possibilities Model Production Possibilities Curve A’ 14 13 12 11 10 9 8 7 6 5 4 3 2 1 B’ Unattainable C’ Industrial Robots U D’ Under or Unemployment E’ 0 1 2 3 4 5 6 7 8 9 Pizzas

Answer each of these Essential Questions: (minimum of three sentence each Explain the difference between Macro and Micro Economics Explain the theory of the Possibilities Curve using yourself as an example

Hmmm….. try this????