1. LECTURE # 1: WHAT IS ECONOMICS?
The Fundamentals of Economics

2. INTRODUCTION TO ECONOMICS
WHY DO WE STUDY ECONOMICS?
WHAT IS THE DEFINITION OF ECONOMICS?
WHAT ARE THE TWO KINDS OF ECONOMICS?

3. INTRODUCTION TO ECONOMICS
WHY DO WE STUDY ECONOMICS?
PERSONAL REASONS-COLLEGE OR WORK, CAREER, SALARY, LOCATION
POLITICAL REASONS-TAXES, SPENDING, THE DEBT AND THE DEFICIT (15 TRILLION)
BUSINESS REASONS-STOCK MARKET, INTEREST RATES, THE ECONOMY

4. INTRODUCTION TO ECONOMICS
DEFINITION OF ECONOMICS
STUDY OF HOW SOCIETIES USE SCARCE RESOURCES
TO PRODUCE VALUABLE GOODS AND SERVICES
AND DISTRIBUTE THEM AMONG DIFFERENT PEOPLE

5. INTRODUCTION TO ECONOMICS
TWO KINDS OF ECONOMICS
MICROECONOMICS-BRANCH OF ECONOMICS INTERESTED IN INDIVIDUAL MARKETS, FIRMS, AND HOUSEHOLDS
MACROECONOMICS-BRANCH OF ECONOMICS INTERESTED IN THE PERFORMANCE OF THE OVERALL ECONOMY

6. II. THE PROBLEM THAT ALL SOCIETIES FACE BECAUSE OF SCARCITY
THEY MUST ALL ANSWER THREE BASIC QUESTIONS
THEY ANSWER THESE QUESTIONS IN THREE DIFFERENT WAYS
ECONOMIST HAVE CHANGED THE WORLD IN ATTEMPTING TO ANSWER THESE QUESTIONS
DECIDE HOW TO USE FACTORS OF PRODUCTION
ALL SOCIETIES MUST CONSIDER THE PRODUCTION POSSIBILITIES CURVE

7. II. THE FUNDAMENTAL PROBLEM THAT ALL SOCIETIES FACE
THEY MUST ALL ANSWER THREE BASIC QUESTIONS
WHAT GOODS TO PRODUCE-A SOCIETY MUST DETERMINE WHAT THEY WILL PRODUCE IN WHAT QUANTITIES
HOW TO PRODUCE THEM-WHO WILL DO THE PRODUCTION WITH WHAT RESOURCES? (OIL, COAL, NUCLEAR POWER)
AND WHO WILL GET THEM-WHO WILL GET TO USE THE GOODS PRODUCED? (RICH, MIDDLE CLASS, POOR)

8. II. THE FUNDAMENTAL PROBLEM THAT ALL SOCIETIES FACE
B. SOCIETIES HAVE USED THREE WAYS TO ANSWER THOSE QUESTIONS
MARKET ECONOMIES-SUPPLY AND DEMAND DETERMINE THE PRICES OF GOODS
COMMAND ECONOMIES-THE GOVERNMENT MAKES ALL DECISIONS ABOUT DISTRIBUTION AND PRODUCTION
MIXED ECONOMICS-A MIXTURE OF THE TWO ( ALL COUNTRIES ARE A MIXTURE, EVEN US)

9. II. THE FUNDAMENTAL PROBLEM THAT ALL SOCIETIES FACE
C. ECONOMIST WHO CHANGED THE COURSE OF HISTORY
ADAM SMITH: THE WEALTH OF NATIONS (1776) FATHER OF MICROECONOMICS
KARL MARX: DEFINED MARXISM/SOCIALISM/COMMUNISM (1800’S)
JOHN MAYNARD KEYNES: THE GENERAL THEORY OF EMPLOYMENT, INTEREST, AND MONEY (1936) FATHER OF MACROECONOMICS

10. II. THE FUNDAMENTAL PROBLEM THAT ALL SOCIETIES FACE
FACTORS OF PRODUCTION (INPUTS)
LAND-SOMEPLACE TO USE FOR PRODUCTION
LABOR-SOMEONE TO DO THE PRODUCING
CAPITAL-EQUIPMENT USED TO DO THE PRODUCING

11. II. THE FUNDAMENTAL PROBLEM THAT ALL SOCIETIES FACE
E. THE PRODUCTION POSSIBILITIES FRONTIER (OUTPUTS)
SOCIETIES MUST CHOOSE WHAT TO PRODUCE FROM THEIR SCARCE RESOURCES
SHOULD THEY PRODUCE MORE GUNS OR BUTTER?
SEE THE PRODUCTION POSSIBILITIES CURVE

12. III. MAKING ECONOMIC DECISIONS
QUICK REVIEW
TRADE-OFFS AND OPPORTUNITY COSTS
MEASURMENTS OF COSTS AND THE COST- BENEFIT ANALYSIS
LET THE BUYER BEWARE

13. III. MAKING ECONOMIC DECISIONS
QUICK REVIEW
ARE YOU COMPLETELY SATISFIED? DO YOU HAVE EVERYTHING YOU WANT? THE ANSWER IN NO!
WE HAVE UNLIMITED NEEDS AND WANTS
NEEDS-GOODS NEEDED FOR SURVIVAL
WANTS-EVERYTHING BEYOND SURVIVAL
AND ALL RESOURCES ARE SCARCE (ANY GOOD THAT IS SCARCE IS CONSIDERED AN ECONOMIC GOOD)

14. III. MAKING ECONOMIC DECISIONS
B. TRADE-OFFS AND OPPORTUNITY COSTS 1. TRADE-OFFS EXIST WHEN YOU HAVE TO CHOOSE ONE ALTERNATIVE OVER ANOTHER. 2. OPPORTUNITY COSTS IS THE NEXT BEST ALTERNATIVE YOU WOULD HAVE CHOSEN.

15. III. MAKING ECONOMIC DECISIONS
C. MEASURMENTS OF COSTS/COST BENEFIT ANAL. 1. FIXED COSTS-COSTS DON’T CHANGE 2. VARIABLE COSTS-CHANGE W/PROD. 3. TOTAL COSTS-FC + VC = TC 4. MARGINAL COSTS-ONE EXTRA UNIT 5. MARGINAL REVENUE-THE EXTRA REVENUE YOU GET FROM SELLING ONE MORE UNIT 6. MARGINAL BENEFIT-ANY POSITIVE RETURN 7. COSTS-BENEFIT ANALYSIS-AN ECONOMIC MODEL THAT COMPARES THE MC AND MB OF A DECISION.

16. III. MAKING ECONOMIC DECISIONS
D. LET THE BUYER BEWARE 1. STAY INFORMED-DON’T LET THEM PULL THE WOOL OVER YOUR EYES! 2. THIS INCLUDES KNOWING THE TRICKS OF THE TRADE! 3. THE ROLE OF THE GOVERNMENT 4. RATIONAL CHOICE-LOGICALLY, WHAT IS THE GREATER GOOD?

17. TEST 2 PREPARATION LOOK OVER YOUR KEY WORDS
LOOK OVER YOUR QUESTIONS AND ANSWERS
LOOK OVER YOUR NOTES
FORMAT
50 QUESTIONS
MULTIPLE CHOICE
MATCHING

18. QUIZ # 2: INTRO/SCARCITY
NAME THREE GENERAL REASONS AS TO WHY WE STUDY ECONOMICS.
NAME THE TWO BRANCHES OF ECONOMICS
NAME THE THREE BASIC QUESTIONS ALL SOCIETIES MUST ASK.
NAME THREE KINDS OF ECONOMICS THAT EXISTS TODAY.
NAME THE THREE FACTORS OF PRODUCTION
III. MAKING ECONOMIC DECISIONS