1. Economics
Decisions, Decisions… 1

2. Types of Economics Microeconomics (micro = “small”)
Studies the behavior of individual people and firms.
Macroeconomics (macro = “large”)
Studies the behavior of entire economies as a whole. 23

3. What is Microeconomics?
Microeconomics is the study of the economic behavior and decision making of small units, such as individuals, families and businesses.
What does that mean? 5

4. Less Formally...
There is not enough of everything that people want (and need) to go around.
Some people will get things and others will not. That is a fact.
How do we determine who gets what? 6

5. Decisions: Where to Start?
Knowing your Values!!
Values: The standards by which you live; principles.
Values = Judgments
Right vs. Wrong
Good vs. Bad
Important vs. Unimportant

6. Decisions (Continued)
Personal Values
Life Values: Most important to you in life
Work Values: Most important to you in your work
Social Values
Values held by a great number of people in a society

7. Decisions (Continued)
Goals:
What you want to accomplish in your life
Needs/wants, hopes/dreams
Needs:
Things you can’t live without
Wants:
Things you would like to have but can live without

8. Trade-off
Trade-Off is an alternative we sacrifice when we make a decision.
Opportunity Cost is the next alternative forgone when using a resource.
Your opportunity cost of watching TV might be studying, talking on the phone or maybe even sleeping. But not all 3 -- only the one you value next best. 12

9. Tonight’s Assignment Due Friday
Write at least two paragraphs about one of your own goals.
Assignment should include:
Explanation of your goal
Some of your personal values
Why is this goal important?
What would be your opportunity cost?
Due Friday