1. Year 12 AS Economics
Ms Haron

2. Start of lesson drills Planner on the desk Pen/stationary available
18/11/2018
Start of lesson drills
Planner on the desk
Pen/stationary available
Folder/Exercise book on the desk
Date and title copied
1.1.3 The economic problem
Ready to learn
Reminder of expectations every lesson
Theme 1 – Microeconomics The economic problem

3. Theme 1 1.1 – The nature of Economics
1.1.3 The economic problem
a) The problem of scarcity – where there are unlimited wants and finite resources
b) The distinction between renewable and non-renewable resources
c) The importance of opportunity costs to economic agents (consumers, producers and government)

4. Last lesson we covered:
18/11/2018
Last lesson we covered:
Scarcity
Scarcity leading to choice
Opportunity costs
Scarcity – a situation that arises when people have unlimited wants in the face of limited resources
Each individual much choose which goods and services to consume. To do this they would prioritise the options into things they need and things they want
When you choose to consume a good, you do so at the cost of the next best alternative in your list of priorities
Opportunity cost is the cost of the next best alternative forgone
Theme 1 – Microeconomics The economic problem

5. 18/11/2018
Opportunity cost
Theme 1 – Microeconomics The economic problem

6. Opportunity cost Be more: Find real examples from BBC News Economy
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Opportunity cost
Find two examples of opportunity cost for an individual
E.g. choosing to go to university rather than join a school leaver programme
Find two examples of opportunity cost for a firm
E.g. choosing to invest in R&D rather than increase employee wages
Find two examples of opportunity cost for the government
E.g. choosing to invest in the NHS rather than education
Be more: Find real examples from BBC News Economy
Theme 1 – Microeconomics The economic problem

7. Opportunity cost Use these links to help you:
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Opportunity cost
Use these links to help you:
When you are done, read this:
Theme 1 – Microeconomics The economic problem

8. Renewable and Non-Renewable
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Renewable and Non-Renewable
However, all is not doom and gloom! Some resources are ‘infinite’, in that given time, they can be renewed.
More on that in the next lesson
Theme 1 – Microeconomics The economic problem

9. 18/11/2018
Renewable resources
A substance of economic value that can be replaced or replenished in the same amount or less time as it takes to draw the supply down.
Some renewable resources have essentially an endless supply, such as solar energy, wind energy and geothermal pressure, while other resources are considered renewable even though some time or effort must go into their renewal, such as wood, oxygen, leather and fish.
Most precious metals are considered renewable as well; even though they are not naturally replaced, they can be recycled because they are not destroyed during their extraction and use.
Theme 1 – Microeconomics The economic problem

10. Non renewable resources
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Non renewable resources
A resource of economic value that cannot be readily replaced by natural means on a level equal to its consumption.
Most fossil fuels, such as oil, natural gas and coal are considered nonrenewable resources in that their use is not sustainable because their formation takes billions of years.
Theme 1 – Microeconomics The economic problem

11. Plenary – Ted baker case study
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Plenary – Ted baker case study
Theme 1 – Microeconomics The economic problem

12. Today we have covered 1.1.3 The economic problem
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Today we have covered
1.1.3 The economic problem
a) The problem of scarcity – where there are unlimited wants and finite resources
b) The distinction between renewable and non-renewable resources
c) The importance of opportunity costs to economic agents (consumers, producers and government)
Theme 1 – Microeconomics The economic problem

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Expectations
Theme 1 – Microeconomics The economic problem