1. The Basic Problem in Economics
ECONOMICS Ch. 1.1 p
The Basic Problem in Economics
Learning Target: Understand the difference between Wants & Needs and the problem Scarcity

2. The Basic Problem in Economics
What determines a need from a want and how do individuals choose to allocate their resources?

3. The Basic Problem in Economics
What determines a need from a want and how do individuals choose to allocate their resources?
Needs are essentials and are required for survival.

4. The Basic Problem in Economics
What determines a need from a want and how do individuals choose to allocate their resources?
Needs are essentials and are required for survival.
Wants are nice to have but are not essentials.

5. The Basic Problem in Economics
What determines a need from a want and how do individuals choose to allocate their resources?
Needs are essentials and are required for survival.
Wants are nice to have but are not essentials.
Individuals must make (economic) choices.

6. Economics

7. Economics
The study of how people use limited resources to fulfill unlimited wants.

8. Microeconomics
Macroeconomics

9. Microeconomics
The study of the economy on a small scale – individuals and firms.
Macroeconomics

10. Microeconomics
The study of the economy on a small scale – individuals and firms.
Macroeconomics
The study of the economy on a large scale or as a whole – Nations or Governments. The Global Economy.

11. SUMMARIZE 2. Write a definition for Economics in your own words.
Discuss at your table & answer on your response sheet.
1. Describe the difference between a need and a want. Give examples.
2. Write a definition for Economics in your own words.
3. Explain the difference between micro and macroeconomics.
Are you on target (white, black, blue, red or yellow)?
Did you hit the bullseye?
Learning Target: Understand the difference between Wants & Needs and the problem Scarcity

12. What is the problem of
scarcity?

13. What is the problem of
scarcity?
People’s money and time are limited.

14. Scarcity

15. People do not have enough money and time to satisfy every want.
Scarcity
People do not have enough money and time to satisfy every want.

16. People do not have enough money and time to satisfy every want.
Scarcity
People do not have enough money and time to satisfy every want.
A combination of limited resources and unlimited wants.

17. Scarcity always exists, while shortages are temporary.
People do not have enough money and time to satisfy every want.
A combination of limited resources and unlimited wants.
Scarcity always exists, while shortages are temporary.

18. SUMMARIZE 5. How are scarcity and shortages alike and different?
Discuss at your table & answer on your response sheet.
4. Describe the concept of scarcity and give an example.
5. How are scarcity and shortages alike and different?
Are you on target (white, black, blue, red or yellow)?
Did you hit the bullseye?
Learning Target: Understand the difference between Wants & Needs and the problem Scarcity

19. What are the Factors of Production and how do they determine an individual’s wealth?

20. What are the Factors of Production and how do they determine an individual’s wealth?
Resources needed to produce goods and services. 1. 2. 3. 4. 5.

21. What are the Factors of Production and how do they determine an individual’s wealth?
Resources needed to produce goods and services.
1. Land (natural resources)

22. What are the Factors of Production and how do they determine an individual’s wealth?
Resources needed to produce goods and services.
1. Land (natural resources)
2. Labor (people)

23. What are the Factors of Production and how do they determine an individual’s wealth?
Resources needed to produce goods and services.
1. Land (natural resources)
2. Labor (people)
3. Capital (manufactured goods used to
make other goods and services)

24. What are the Factors of Production and how do they determine an individual’s wealth?
Resources needed to produce goods and services.
1. Land (natural resources)
2. Labor (people)
3. Capital (manufactured goods used to
make other goods and services)
4. Entrepreneurship (people who create
goods or start businesses)

25. What are the Factors of Production and how do they determine an individual’s wealth?
Resources needed to produce goods and services.
1. Land (natural resources)
2. Labor (people)
3. Capital (manufactured goods used to
make other goods and services)
4. Entrepreneurship (people who create
goods or start businesses)
5. Technology (used to produce goods and
services more efficiently)

26. SUMMARIZE 7. Explain what Capital is.
Discuss at your table & answer on your response sheet.
6. List the Factors of Production.
7. Explain what Capital is.
8. Explain the impact of Technology.
Are you on target (white, black, blue, red or yellow)?
Did you hit the bullseye?
Learning Target: Understand the difference between Wants & Needs and the problem Scarcity

27. Goods
Services

28. Goods
Tangible items that people buy.
Services

29. Goods
Tangible items that people buy.
Services
Activities done for others for a fee.

30. Productivity

31. Productivity
The amount of output (goods or services) from a set level of input.
Productivity will generally increase with more Capital.

32. Who was Adam Smith?

33. Who was Adam Smith?
A Scottish professor and author.

34. Who was Adam Smith?
A Scottish professor and author.
He wrote An Inquiry into the Nature and Causes of the Wealth of Nations.

35. Who was Adam Smith?
A Scottish professor and author.
He wrote An Inquiry into the Nature and Causes of the Wealth of Nations.
Founder of classical economics.

36. Who was Adam Smith?
A Scottish professor and author.
He wrote An Inquiry into the Nature and Causes of the Wealth of Nations.
Founder of classical economics.
He said people should be allowed to pursue their own wealth through the free market system with minimal government interference.

37. SUMMARIZE 9. Write a definition for Productivity in your own words.
Discuss at your table & answer on your response sheet.
9. Write a definition for Productivity in your own words.
10.Who was Adam Smith?
Are you on target (white, black, blue, red or yellow)?
Did you hit the bullseye?
Learning Target: Understand the difference between Wants & Needs and the problem Scarcity