1. Economic Perspective
August 27th

2. ESSENTIAL QUESTIONS

3. HOW CAN YOU THINK LIKE AN ECONOMIST?

4. Preview of Class: Respond to each question
Preview of Class: Respond to each question. Provide a thorough explanation for each decision Title: Economic Perspective: August 27, 2014
1. If you could choose between two nearly identical products—one that is free and one that you have to pay for—which would you choose? Why?
2. If you were opening a new business, would you select a location closer to or farther away from a business that sold a similar or even identical product? Why?
3. If you could make a small change in your daily routine that would save you time and money, would you make the change? Why or why not?

5. Questions to discuss
1. How many of you chose the free product? How many chose the one that you had to pay for? What was your reasoning?
2. How many of you chose to locate your business close to the existing business? How many chose to locate it farther away? What was your reasoning?
3. How many of you chose to make the change in your daily routine? How many chose not to make the change? What was your reasoning?
4. For the three scenarios above, under what circumstances would you choose the option you did not select?

6. You have just considered how you would react in three real-world scenarios.
In this lesson, you will learn how to apply an economic way of thinking to help see the role that economics plays in various types of decision making.
Economics provides a way of looking at and questioning what happens around us. This lesson will introduce you to the principles and tools economists use to make sense of the world.

7. Be sure you understand the Speaking of Economics terms for this lesson and use them in your answers as you complete the Reading Notes.
Economics p4
Cost-benefits analysis p5
Economy
Incentive
Positive economics p7
Opportunity cost p4
Normative economics p7
Scarcity p4
Utility
Tradeoff p9
Economizing problem 09
Enigma: a puzzling or inexplicable occurrence or situation:

8. Reading notes Ch. 1 (pages 1-9) Follow these steps to write a nine-line acrostic poem explaining what economics is all about.
Write the term ECONOMICS vertically along the left side of a notebook page. Begin each line with a word that starts with the appropriate letter.
Each line must help answer the question, What is economics all about?
Include the following terms somewhere in your acrostic: enigma, resource, scarce, science, normative economics, tradeoff, opportunity cost, and positive economics

9. E
CONOM I C S
ach resource is scarce.

10. 1. Scarcity forces tradeoffs (p1) 2. Cost versus benefits (p5)
NOW, set up a table with rows to list seven principles of economic thinking. In the first column, write the name of each principle. Then create a symbol or simple illustration that helps explain that principle. Finally, write a one-sentence summary of the principle.
1. Scarcity forces tradeoffs (p1)
2. Cost versus benefits (p5)
3. Thinking at the margin(p5)
4. Trade makes people better off (p18)
5. Markets coordinate trade (p32)
6. Incentives matter (38)
7. Future consequences count (We will talk about this)

12. Would raising highway speed limits improve the economy
Create a flowchart illustrating the steps of the scientific method. Think of a concrete example of how an economist would use this tool
Would raising highway speed limits improve the economy
Ask a question
Research the question

13. Processing: Enigma: A puzzle that seems to defy common sense
Here are four economic enigmas
1. Why do economy seats on airplanes cost different amounts?
2. Why do people pay more for name-brand products when there are generic brands of the same product available for less?
3. Why do police officers get paid so much less than professional baseball players?
4. Why does five-day Disneyland pass cost only 2.5 times what a one -day pass costs?

14. 1. Choose one of these economic enigmas, or think of one that you have observed in your own life. Follow these steps to apply an economic way of thinking to help explain your enigma
2. Choose the one principle that you believe best explains your enigma. Explain why this principle provides the best explanation.