Early Civilizations are existing in isolation, how do we begin to connect with each other? Over the next few weeks we will be exploring this new interconnectedness that emerges Silk Road Economics

ECONOMICS Major Concepts

Major Concepts Everything has a cost and a tradeoff Voluntary trade increases value Major Concepts

Does getting something of value always cost something? “There is no such thing as free lunch” Let’s use an example we are all familiar with—waking up for school DECISIONS MEAN COSTS

What should you know? What has been demonstrated to you? Every decision you make has an opportunity cost Choosing is refusing Opportunity Cost is the next best alternative, not all of the possibilities Because people value different things, everyone’s opportunity costs might be different Because people’s values differ, the opportunity cost of the same decision may differ from person to person DECISIONS MEAN COSTS

DECISIONS MEAN COSTS Now try one on your own… As a table group create a decision making table about a decision you made this weekend We will display the tables on the board DECISIONS MEAN COSTS

In your journals, explain the phrase “choosing is refusing” In your journals, explain the phrase “choosing is refusing”. How does it relate to our lesson yesterday? Take a guess…how might it connect to our study of the Silk Road? ENTRY QUESTION

Major Concepts Everything has a cost and a tradeoff Voluntary trade increases value Major Concepts

Trade is the voluntary exchange of goods or services, or both. Think of an occasion in which you have engaged in trading something for something else. a. What did you trade? b. What did you get in exchange? c. Were you satisfied with the trade? Why or why not? d. What conditions have to be fulfilled for you to engage in trade? VOLUNTARY TRADE

https://wetheeconomy.com/films/cave-o-nomics/ VOLUNTARY TRADE

Is trade mutually beneficial? The Secret Bag Activity VOLUNTARY TRADE

Do not tell others what is in your bag, do not take your item out of the bag You will rate how you feel about your item on the glee index (1-5, 1 is low/unsatisfied, 5 is high/extremely satisfied) SECRET BAG ACTIVITY

What should you know? What has been demonstrated to you? Voluntary trade creates value The benefits of trading far outweigh the costs in almost every situation Trade improves people’s wealth and satisfaction People won’t trade if the good being offered is worth less than the good they are asked to exchange. VOLUNTARY TRADE