Chapter 18.1 The Fundamental Economic Problem. Economic Choices Economics is the study of how we make decisions in a world where resources are limited.

Slides:



Advertisements
Similar presentations
Economics Chapter 1 Section 1.
Advertisements

What is Economics? Chapter 18.
The Economic WayofThinking.
Chapter 18 Objectives: 7.01, 7.02, How Economic Systems Work We choose between: –Needs: things required for survival –Wants: things we desire and.
Warm-Up Ch.13 Section 1 What is it that you want right now? It can be any material possession in the world that is sold legally. Describe the process in.
Economics Review.
Economics 1. What is economics? It is the study of how people make decisions in a world where resources are limited: the science of decision making.
Chapter 1 What is Economics?. Section 1-1: The Basic Problem in Economics What is economics?  The study of how people satisfy their unlimited wants and.
Economic Choices: Well informed citizens make rational economic choices everyday. The choices we make are based on the fact that we do not have enough.
Chapter 1 Economics and the World of Scarcity Chapter 1 Economics and the World of Scarcity.
Starter What is economics?.
Chapter 1.  The basic problem in economics….is what?  How is the economy reported in the news?  How does this affect your life?  Did you know? Pg.
Economic Decisions Fri. September 2, Today’s Objectives  Distinguish the difference between wants and needs  Explain the difference between goods.
Ten Principles of Economics
Chapter 18: What is Economics?. Section 1: Economic Problems Economics – The study of how we make decisions based on limited resources. Scarcity – Occurs.
What is Economics?. Economics is... Study of how we make decisions based on limited resources.
Chapter 18 What is economics?
What is Economics? Chapter 18.
Fundamental Economic Concepts The Problem – Human wants are unlimited but resources are not, therefore scarcity exists. Economics is the study of how people.
Splash Screen 2 Section 1-3 In 1901, people discovered oil in Texas— but they were actually looking for water! Disappointed, they offered to trade the.
What is Economics? A. What is the Basic Problem in Economics?
What is an Economy? Chapter 13.
Splash Screen Section 1-1 Guide to Reading Economics is the study of how individuals and societies make choices about ways to use scarce resources to.
Economic choices as an individual and a nation.  Read the section titled “Economic choices” on page 406 in your textbook and answer the above question.
The Four Factors of Production (CELL)
Warm up questions – 1/28/2014 What are some economic decisions you made in the last 24 hours? (ie. time, money) What were some alternatives that you were.
The Fundamental Economic Problem. What is Economics? Economics is the study of how we make decisions in a world where resources are limited. It is sometimes.
1 Scarcity and the Science of Economics Chapter Introduction 2 Explain the fundamental economic problem.  Examine the three basic economic questions every.
Chapter 18 What is Economics? Section 1- The Fundamental Economic Problem.
Vocabulary: Unit 8  Economics- The study of making decisions in a world with limited resources.  Scarcity- The fundamental economic problem.  Factors.
Chapter 1 What is Economics?. Section 1-1: The Basic Problem in Economics What is economics?  The study of how people satisfy their unlimited wants and.
FrontPage: Imagine you are as rich as Bill Gates. Can/do you “have it all”? The Last Word: No homework.
WHAT IS ECONOMICS? Business Economics. What is Economics? Economics - The study of how individuals, families, businesses, and societies use limited resources.
Starter  Get with a group of 3-4 people near you.  Read the “What is economics really about?” handout.  Discuss the handout and decide how you will.
Chapter 18 Notes What is Economics?. Bellwork Chapter 18  Define key terms on page 406.
Introduction to Economics What do you think of when you think of economics?
What is Economics? Chapter 18 (Part 1). Economic Choices  To properly perform our civic duty, we should be INFORMED citizens  Part of being informed.
Chapter 18: What is Economics?. Section 1: Economic Problems Economics – The study of how we make decisions based on limited resources. Scarcity – Occurs.
Economics- the study of how people in a society make a living Economist- a person who studies economic choices.
Vocabulary  Economics- The study of making decisions in a world with limited resources.  Scarcity- The fundamental economic problem.  Factors of Production-
WHAT IS ECONOMICS? ECONOMICS IS THE STUDY OF HOW WE MAKE DECISIONS IN A WORLD WHERE RESOURCES ARE LIMITED. THERE ARE THREE QUESTIONS THAT WE MUST ASK WHEN.
7.2 Scarcity & Opportunity Cost
What is Economics? Chapter 18
Economics & Scarcity Economics is the study of how individuals and societies satisfy their unlimited wants with limited resources. Scarcity is the situation.

The Four Factors of Production (CELL)
What is Economics? How do economists study the ways people make decisions on how to use their time, money, and resources?
The Basic Problem in Economics
Economic Principles – chapter 18 _...
The Basic Problem in Economics
UNIT VI – Fundamentals of Economics
Unit 8, Lesson 1 Fundamental Economics
What is Economics? How do economists study the ways people make decisions on how to use their time, money, and resources?
What is Economics? How do economists study the ways people make decisions on how to use their time, money, and resources?
Fundamental Economics
Chapter 18 Section 1.
The Fundamental Economic Problem
What is Economics? How do economists study the ways people make decisions on how to use their time, money, and resources?
The Fundamental Economic Problem
Fundamental Economics
The Study of Economics Guided Notes.
The Basic Problem in Economics
The Basic Problem in Economics
The Fundamental Economic Problem
What is Economics? How do economists study the ways people make decisions on how to use their time, money, and resources?
Chapter 1 Section 1.
Please take notes on the following slides in your Business notebook
The Basic Problem in Economics
What is Economics? Chapter 18.
THE BASIC ECONOMIC PROBLEM
Presentation transcript:

Chapter 18.1 The Fundamental Economic Problem

Economic Choices Economics is the study of how we make decisions in a world where resources are limited. It is sometimes called the science of decision making. Needs are things we need for survival, such as food, clothing and shelter. Wants are things we would like to have. The fundamental economic problem is scarcity – we do not have enough resources to produce all the things we would like to have. Because of scarcity, we must make choices among alternatives.

continued Society must decide what to produce with its limited resources. For example, society may have to choose whether to produce good for defense or services for poor people. Society must decide how to produce. For example, should we accept more pollution from factories in exchange for more products? Society must decide for whom to produce. Who will receive the goods and services? In the U.S., most goods and services are distributed through the price system.

Using Economic Models The economy includes all the activity in a nation that together affects the production, distribution and use of goods and services. To study a part of the economy, economists use economic models. These are simplified representations of the real world, based on economic theories. Business and gov’t often base decisions on solutions that emerge from testing economic models.

continued Models are based on assumptions. The quality of the model’s results can be no better than the assumptions on which it is based. Economists use models to better understand the past or present and to predict the future. If predictions based on a model turn out to be wrong, economists revise the model.