Economics  Welcome to Class! Find a folder on the front table, write your name on it, and draw a picture that represents you! (appropriate!)

Getting Started! Define Economics? What is the study of Economics? What factors impact the economy?

Economics What is Economics?

Economics is

Or is Economics This…

Economics is…  The study of how people seek to satisfy their needs and wants by making choices.  What is a need and want? How do we determine that?  Need and Wants Activity

Goods and Services  Goods – Physical Objects Examples: Clothing, Cars, Food Examples: Clothing, Cars, Food  Services – Actions/Activities one performs for another Examples: Auto Repair, Restaurants, Haircuts Examples: Auto Repair, Restaurants, Haircuts  Why don’t we have all those things on our lists?

When There’s Not Enough To Go Around  Scarcity = Limited resources to meet unlimited wants  What are some of our scarce resources? Money, Time, Land, Labor Money, Time, Land, Labor  This forces us to must make choices.

Opportunity Cost  Can we have everything that we need/want?  Opportunity Cost: What is given up to get what we want.  What would be given up to get some of things we mentioned earlier?

Economics  What was an opportunity cost for something you did or purchased yesterday?

Production Possibility Frontiers  Opportunity Costs for Countries. Guns and Butter – Military goods vs. Food products Guns and Butter – Military goods vs. Food products Example: World War II Military Production. Spending money in poverty stricken countries or our own. Example: World War II Military Production. Spending money in poverty stricken countries or our own.  Because countries have limited resources and must make choices.  This can be Graphed with a Production Possibilities Curve (PPC)

PPC – What can it do?  Demonstrate all the possible opportunity costs  Show us how efficient economies are  Show whether an economy has grown or shrunk

Entrepreneurship  Entrepreneurs own and manage their own business  What are the opportunity costs of being an entrepreneur?  What are some advantages and disadvantages?

Entrepreneurship Advantages  Easy to start  You get all the profits  You have full control  Easy to stop Disadvantages  Fully responsible for debt  Limited access to resources  Lack of permanence Why would it be important for Entrepreneurs to shift the PPC?

Tanks Food Units 20m 15m 10m 5m 0 50m100m150m200m Production Possibility Curve Efficiency Inefficiency Potential Growth

Shifting the PPC  Four Ways to Shift the PPC More resources More resources Efficiency Efficiency Technology Technology Work Ethic Work Ethic

Put it into Practice

Exit Question Why is it important to understand a productions possibility curve and how can you shift the productions possibility curve?

Unlimited Wants “Gimmie-Gimmies” Limited Resources “Sorry Charlies” Scarcity Choices What to ProduceHow to Produce For Whom to Produce Scarcity forces choices.

Choices To Be Made  What to produce Trains, planes, automobiles, food Trains, planes, automobiles, food  How to produce By hand, machine, assembly line By hand, machine, assembly line  For whom to produce Me, you, adults, kids, dogs, cats, Bo-Bo the elephant Me, you, adults, kids, dogs, cats, Bo-Bo the elephant