2. 1 JOURNAL Click the mouse button or press the Space Bar to display the information. Journal According to a Harris poll, a huge percentage of Americans think it is.  They must know what economists know— that a basic understanding of economics can help make sense of the world around us. Do you think the study of economics is worth your time and effort? 

3. 2 Portfolio Change!!!! 1.Chapter Assignments-  Will be assigned, given a due date & collected for approval!  If ok/approved-then you will get credit for the assignment!  If you do not complete your assignments- you will lose ½ credit for that chapter!

4. Splash Screen Chapter 1 What Is Economics?

5. 4 Economic Concepts 1

6. 5 Chapter Introduction 1 Economics and You The study of economics will help you become a better decision maker–it helps you develop a way of thinking about how to make the best choices for you. Click the Speaker button to listen to Economics and You.

7. 6 Chapter Introduction 2 Chapter Objectives Explain the fundamental economic problem.  Examine the three basic economic questions every society must decide. Click the mouse button or press the Space Bar to display the information. Explain the relationship among scarcity, value, utility, and wealth.  Understand the circular flow of economic activity Analyze trade-offs and opportunity costs.  Explain decision-making strategies.

8. 7 Section 1-4 Click the mouse button or press the Space Bar to display the information. Did You Know? We witness scarcity with each year’s “hot” new toy. Inspired by hunter President Teddy Roosevelt, Americans coveted the teddy bear in 1906. Cabbage Patch dolls were big during the 1980s, as were Tickle Me Elmos in 1996. By 1999 Game Boy’s Pokémon was the rage with a 10-cent trading card. The most-prized first-edition pocket monsters were in such short supply that they commanded from $8 to $182.

9. 8 Section 1-5 Click the mouse button or press the Space Bar to display the information. Fundamental Economic Problem Economics is the study of how people satisfy wants w/scarce resources.  Scarcity is the condition where unlimited human wants face limited resources.  Needs are required for survival; wants are desired for satisfaction.  Someone has to pay for production costs.

10. 9 Section 1-Assessment 1 Discussion Question (DO NOT WRITE) Why do you think scarcity is an issue with the rich as well as the poor? It is a human trait that few people, regardless of their economic status, are satisfied with what they have. Click the mouse button or press the Space Bar to display the answer.

11. 10 Section 1-9 Click the mouse button or press the Space Bar to display the information. Three Basic ?’s 1.What must we produce? Society must choose based on its need.  2.How should we produce it? Society must choose based on its resources.  Figure 1.1 3.For whom should we produce? Society must choose based on its population & other available markets.

12. 11 Section 1-Assessment 1 Discussion Question How might the economic decisions of a mountainous island society differ from those of a mountainous landlocked society? An island society has water resources to consider and likely a more limited population. Click the mouse button or press the Space Bar to display the answer.

13. 12 Section 1-13 Click the mouse button or press the Space Bar to display the information. Factors of Production Land is the society’s limited natural resources; 1.Landforms 2.Minerals 3.vegetation, 4.animal life 5.climate.  are resources necessary to produce what people want or need.  Capital--means by which something is produced such as $$$, tools, equip, machinery,& factories.

14. 13 Section 1-13 Click the mouse button or press the Space Bar to display the information. Entrepreneurs are risk-takers who combine land, labor, & capital into new products.  Labor--workers who apply their efforts, abilities, & skills to production.  Production is creating goods & services— the result of land, capital, labor, & entrepreneurs.

15. 14 Section 1-14 The Factors of Production (cont.) Click the mouse button or press the Space Bar to display the information.

16. 15 Section 1-20 Click the mouse button or press the Space Bar to display the information. Scope of Economics deals w/description of economic activity— Gross Domestic Product, unemployment rate, govt spending, tax rates, etc. 

17. 16 Section 1-20 Click the mouse button or press the Space Bar to display the information. Explanation refers to how economists communicate knowledge--economy & its activities to the society’s population.  Prediction refers to how yesterday’s & today’s economic activities advise us of potential future activity.

18. 17 Section 1-Assessment 1 Discussion Question Why are entrepreneurs an economy’s driving force? Their abilities to start new businesses and introduce new products may re- energize a sluggish economy or strengthen a successful economy. Click the mouse button or press the Space Bar to display the answer.

19. 18 Economic Choices 1.What to produce 2.How to produce 3.For whom to produce List & describe the 3 economic choices each society must make. Reading Strategy

20. End of Section 1 Click the mouse button to return to the Contents slide.

21. 20 Journal Journal Describe the factors of production. The factors of production are land, capital, labor, & entrepreneurs. Click the mouse button or press the Space Bar to display the answer. List the three basic economic questions every society must answer. Every society must ask what to produce, how to produce, & for whom to produce.

22. 21 Section 2-1 Click the mouse button or press the Space Bar to display the information. Section 2 begins on page 12 of your textbook. Objective An economic product is a good or service that is useful, relatively scarce, and exchangeable. 

23. 22 Section 2-4 Click the mouse button or press the Space Bar to display the information. Did You Know? The 20 percent of the world’s people who live in the wealthiest nations consume 86 percent of the world’s goods and services. The 20 percent who live in the poorest nations consume just 1.3 percent.

24. 23 Section 1-Assessment 1 Discussion Question What makes economics a social science? Economics is a study of human behavior because it looks at the decisions people make and how they react to those decisions. Click the mouse button or press the Space Bar to display the answer.

25. 24 Section 2-5 Click the mouse button or press the Space Bar to display the information. Goods, Services, & Consumers Goods--items that are economically useful or satisfy a want. tangible & can be classified as consumer/capital & durable/non-durable.  Services are work performed for someone & are intangible.  Consumers use goods & services to satisfy wants & needs.

26. 25 Section 2-9 Click the mouse button or press the Space Bar to display the information. Value, Utility, & Wealth Value is worth expressed in dollars & cents..  Utility--good’s or service’s capacity to provide satisfaction, which varies w/needs & wants of each person.  Wealth--accumulation of goods that are tangible, scarce, useful, & transferable to another person.

27. 26 Section 2-Assessment 1 Discussion Question Why might a wealthy society not have as much economic staying power as another wealthy society with a highly skilled labor force? (possible answers) may indicate that wealth is usually based on limited natural resources, whereas labor can produce more goods and services. Click the mouse button or press the Space Bar to display the answer.

28. 27 Section 2-13 Click the mouse button or press the Space Bar to display the information. Circular Flow of Economic Activity Markets are locations/mechanisms for buyers & sellers to trade.  A factor market is where people earn their incomes.  A product market is where people use their income to buy from producers.

29. 28 Section 2-14 Click the mouse button or press the Space Bar to display the information.

30. 29 Factor Market Producers sell goods & services Money returns to businesses Businesses produce more goods & services Reading Strategy

31. End of Section 2 Click the mouse button to return to the Contents slide.

32. 31 Section 3-3 Click the Speaker button to listen to the Cover Story. Click the mouse button or press the Space Bar to display the information. Section 3 begins on page 19 of your textbook. Objectives After studying this section, you will be able to:  –Analyze trade-offs and opportunity costs.  –Explain decision-making strategies. 

33. 32 Section 2-17 Click the mouse button or press the Space Bar to display the information. Productivity & Econ. Growth Productivity is a measure of the amount of output produced by the amount of inputs w/in a certain time.  Specialization & division of labor may improve productivity b/c they lead to more proficiency.

34. 33 Section 2-17 Click the mouse button or press the Space Bar to display the information. Investing in human capital improves productivity b/c when people’s skills, abilities, health, & motivation advance, productivity increases.  Economic growth depends on high productivity.

35. 34 Section 3-5 Click the mouse button or press the Space Bar to display the information. Trade-Offs & Opportunity Cost Trade-offs are the alternative choices people face in making an economic decision.  Opportunity cost is the cost of the next best alternative among a person’s choices.

36. 35 Section 3-6 Click the mouse button or press the Space Bar to display the information. Figure 1.5 Trade-Offs and Opportunity Cost (cont.)

37. 36 Section 3-24 Click the mouse button or press the Space Bar to display the information. The Road Ahead will help us know how the economy works on a daily basis.  It helps us understand a free enterprise economy.  study of economics helps us to become better decision makers. 

38. 37 Making decisions Trade-offs Opportunity costs Reading Strategy Explain what you need to know to become a good decision maker.

39. 38 Chapter 1 Portfolio Assignment: 1.Design a Newspaper Ad that illustrates the 3 basic economic questions. 2.Use one plain white sheet of paper. 3.More creative the better score!!! 4.Due when the portfolio is turned in.

40. 39 ___Economic products designed to satisfy people’s wants and needs are called _____. ___The _____ of a CD player can be expressed in dollars and cents. ___Haircuts, repairs to home appliances, and entertainment are examples of _____. Click the mouse button or press the Space Bar to display the answer. The Chapter Assessment is on pages 28–29. Chapter Assessment 1 Identifying Key Terms Choose the letter of the term that best completes the following sentences. B J I A. capital goods F.human capital B. consumer goods G.opportunity cost C. consumers H.scarcity D. factors of production I.services E. utilityJ.value

41. 40 Chapter Assessment 2 Click the mouse button or press the Space Bar to display the answer. Identifying Key Terms (cont.) ___ _____ arises because society does not have enough resources to produce all the things people would like to have. ___The _____ of going to a football game instead of working would include the money not earned at your job. ________ is the sum of the skills, abilities, health, and motivation of people. Choose the letter of the term that best completes the following sentences. H G F A. capital goods F.human capital B. consumer goods G.opportunity cost C. consumers H.scarcity D. factors of production I.services E. utilityJ.value

42. 41 Chapter Assessment 3 Click the mouse button or press the Space Bar to display the answer. Identifying Key Terms (cont.) ________ is another name for the capacity of a product to be useful. ___ The only factors of production that are themselves the result of earlier production are _____. ___ Land, capital, labor, and entrepreneurs are _____. ___ People who use goods and services to satisfy their wants and needs are called _____. E A D C A. capital goods F.human capital B. consumer goods G.opportunity cost C. consumers H.scarcity D. factors of production I.services E. utilityJ.value Choose the letter of the term that best completes the following sentences.

43. End of Section 3 Click the mouse button to return to the Contents slide.

44. 43 Section 3-Assessment 4 Section Assessment (cont.) Click the mouse button or press the Space Bar to display the answer. Explain why the study of economics is important to the American free enterprise system. Economic issues are an important part of many political campaigns. An understanding of the issues will help a citizen decide how to vote in an election.

45. 44 Chapter Summary 1 Section 1: Scarcity and the Science of Economics Click the mouse button or press the Space Bar to display the information. The basic economic problem of scarcity is due to the combination of people’s seemingly unlimited wants and relatively scarce resources.  In a world of scarce resources, There Is No Such Thing As A Free Lunch (TINSTAAFL).  Because of scarcity, society has to decide WHAT, HOW, and FOR WHOM to produce.  Land, capital, labor, and entrepreneurs are the four factors of production required to produce the things that people use.

46. 45 Chapter Summary 2 Click the mouse button or press the Space Bar to display the information. Section 1: Scarcity and the Science of Economics (cont.) Entrepreneurs are risk-taking individuals who go into business in order to make a profit; they organize the other factors of production.  The scope of economics deals with description, analysis, explanation, and prediction.

47. 46 Chapter Summary 3 Click the mouse button or press the Space Bar to display the information. Section 2: Basic Economic Concepts Consumers use goods and services to satisfy their wants and needs.  Something has value when it has utility and is relatively scarce.  Wealth consists of products that are scarce, useful, and transferable to others, but wealth does not include services, which are intangible.  Markets link individuals and businesses in the circular flow of economic activity; the factors of production are traded in factor markets; goods and services are traded in the product markets.

48. 47 Chapter Summary 4 Click the mouse button or press the Space Bar to display the information. Section 2: Basic Economic Concepts (cont.) Productivity and investments in human capital help economic growth; investments in human capital are among the most profitable of all investments.  Increases in specialization and division of labor cause more economic interdependence.

49. 48 Chapter Summary 5 Click the mouse button or press the Space Bar to display the information. Section 3: Economic Choices and Decision Making The opportunity cost of doing something is the next best alternative, or trade-off, that you give up.  A decision-making grid can be used to help evaluate alternatives.  A production possibilities frontier shows the various possible combinations of output that can be produced when all resources are fully employed; production inside the frontier occurs when some resources are idle or are not being used to their maximum capability.

50. 49 Chapter Summary 6 Click the mouse button or press the Space Bar to display the information. Section 3: Economic Choices and Decision Making (cont.) When economic growth takes place, the production possibilities frontier shifts outward, showing that more products are produced than before.  The economic way of thinking involves simplification with model building, cost-benefit analysis to evaluate alternatives, and incremental decision making.  The study of economics will make you a better decision maker and will help you to understand the world around you; however, the study of economics will not tell you which decisions to make.

51. 50 Chapter Summary 7 Section 3: Economic Choices and Decision Making (cont.) The study of economics helps people understand how a free enterprise economy makes the WHAT, HOW, and FOR WHOM decisions.

52. Economic Concepts 1

53. Focus Activity 1.1 Continued on next slide.

54. Focus Activity 1.2

55. Focus Activity 2.1 Continued on next slide.

56. Focus Activity 2.2 What goods and services should be produced? How should the goods and services be produced?