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Factors of production-
Inputs into the production process. Outputs are finished products. The main factors are land, labor, capital, and entrepreneurship.
Nick WuenschePeriod 1
Land, labor, capital, and entrepreneurship are the factors that go into the production process.
Land- natural resources Labor-the effort put into the
process Capital-what is required to start a
business Entrepreneurship-effort put into
organizing labor
Explanation
Visual
Computer
Time and effort
MoneyElectroni
cs
Connection
Economics- the social science that analyzes the production, distribution, and consumption of goods and services.Scarcity- the state of being scarce or in short supply; shortage.
ECONOMICS AND SCARCITY
EXPLANATION• Divided into two divisions: Microeconomics and
Macroeconomics• Economics is anything that has to do with goods
being produced, distributed, or consumed• Scarcity is when there is a finite amount of
resources. Nature doesn’t provide as much as people want
• Scarcity affects the production area of economics• When there are limited resources, we must
control how much we produce, so we don’t run out
CONNECTION
CapitalismBy Sara Rowlands
Capitalism- A form of economic order characterized by private ownership of the means of production and the freedom of private owners to use, buy and sell their property or services on the market at voluntarily agreed prices and terms, with minimal or no interference from governmentX
Explanation economic system based on competition
between businesses Involves private ownership Minimal government involvement Agrees with laissez faire (belief that
economies function best when there is no interference by government)
Everyone has fair chance of becoming
successful and wealthy
Wealthiest people or companies have all
the power over others
Connection Donald Trump is a famous capitalist He purchases property at a low price,
waits for the value of the property to go up, and then sells it
makes a large profit He is often called a
“self-made man" because he earns his own fortune with no or minimal government involvement
*Debt and CollateralBecky Peters10/31/13
*Definition
*Debt: something, typically money, that is owed or due.
*Collateral: something pledged as security for repayment of a loan, to be forfeited in the event of a default.
*Explain Concept - Debt
*Examples of debt: bonds, loans, etc.
*For example:
*Company might have to borrow $1 million for a piece of equipment
*Debt of $1 million must be paid back to the creditor at a later date
*Used as a method for making large purchases people/corporations are unable to afford under normal circumstances
*Explain Concept - Collateral
*Examples of collateral: if you got a mortgage, your collateral would be your house
*If you stop making monthly house payments, lender can take possession of the home through a process called foreclosure
*Not just mortgages: vehicle would be seized if you stop making car payments
*Graphic
*Connection
*Debt = if you borrow a pencil from a friend, you owe them their pencil or a pencil that’s just as good back
*Collateral = if you borrow a pencil from a friend, and they take a pen from you to make sure you give the pencil back. If you don’t give it back, they keep the pen.
Kendall O’Neill
NEEDS AND WANTS
Definition•Needs- of necessity; necessarily•Wants-to feel a need or a desire for; wish for
Explanation•Needs are things that are required for life (ex. Food and water)•Wants are extra items that make life easier (ex. Dishwasher)•For example if you live in Alaska you need a winter coat, but you want a Northface
Visual
Connection
The GDPBy Natalie Carlin
What is the GDP?
• The monetary value of all the finished goods and services produced within a country's borders in a specific time period.
A Simple Explanation…
GDP = C + G + I + NX
where:
"C" is equal to all private consumption, or consumer spending, in a nation's economy
"G" is the sum of government spending
"I" is the sum of all the country's businesses spending on capital
"NX" is the nation's total net exports, calculated as total exports minus total imports. (NX = Exports - Imports)
http://www.investopedia.com/video/play/what-is-gdp/
Remember it by…
• Thinking of a big animated monster named GDP that needs to eat CGI and NX to stay alive. (GDP=C+G+I)
FREE MARKET ECONOMYBy: Rachel Millstein
Define Terms
A market economy based on supply and demand with little or no government control
An idealized form of a market economy where buyers and sellers are allowed to transact freely based on a mutual agreement on price without state intervention in the form of taxes, subsidies or regulation.
Explain Concept The state government is not able to
intervene with the citizens All trading markets are under their own
regulations and determine their own trading laws
The markets are able to enforce specific laws while maintaining under loose regulations
More freedom than any economy seen prior
Comparison
Free Market Economy
Freedom to do what you please
or
The Farmer’s MARKET sells FREE
food
Stock Market and the DOW Jones IndustrialDanielle Luftschein
DEFINITIONS
Stock market: the organized buying and selling of a company’s shares/stocks both over-the-counter and on the web.
DOW Jones Industrial: tracks the stock market for investors. The average of 30 significant stocks traded on the NYSE and NASDAQ
CONCEPT
Progress in the stock market is reflected by the DOW, so investors know what to invest in. The proceeds from the stock market are poured back into companies, which use the money to improve efficiency and productivity.
Many stock exchanges only sell stocks that meet trading criteria, such as a certain amount of money earned by the company per year.
Connections
The DOW is to the stock market as a corollary is to a theorem, in that the DOW can’t exist without the stock market.
Yeahhh! I earned a penny!
Videos
http://www.investopedia.com/terms/s/stockmarket.asp
BY: G RAC E L AG G A N
GLOBAL ECONOMY
GLOBAL ECONOMY-DEFINITION
•Global economy is the economy of all the world’s nations and society combined to reflect the overall economic state of the world
GLOBAL ECONOMY-CONCEPT
• Used to monitor the economic activity between countries, because each economy affects the other • Can be evaluated in many ways depending on the
model used• Typically judged in monetary terms• The value of the economy can be represented in
a specific currency such as the official value of the U.S. Dollar or Euro
GLOBAL ECONOMY-CONCEPT
• All of the world’s economies combined • Often only includes human economic activities,
but can also include the values of resources• Global Economy is exclusive to values of
resources on planet earth so (for example) the value of mining on Mars would not be included in global economic value• Also does not include economic activities without
a legal market like black market and drug trade
GRAPHIC
CONNECTION
•The globe is all the countries combined, and so is the global economy
Credit and InterestBy Thomas Francis
Kullmann
INTEREST-A sum paid or charged for the use of money or for borrowing
money (such a sum expressed as a percentage of money borrowed to be paid over a period of time)
CREDIT-Confidence in a purchaser’s ability and intention to pay,
displayed by entrusting the buyer with goods or services without immediate payment
CREDIT CARDSCredit card issuers give credit
cards to people as a system of payment based on the cardholder’s promise to pay for them. The issuer creates an account and grants a “line of credit” from which the cardholder can borrow.
CREDIT CARD INTEREST
The main way in which credit card issuers generate revenue. Card issuers are normally banks or credit unions. The bank pays the cardholder and then charges the cardholder interest over the time the money remains borrowed.
Cardholder
Credit Card
Bank
Interest
Money
Store
Goods/Services
How you will remember it…I have no pneumonic, so I’ll explain it in layman’s
terms.
If you get a credit card from a credit card issuer, then you are a cardholder.
If you are a cardholder, you use the card as a sort of substitute for a sort of IOU that your issuer picks up.
At some point, you pay the issuer with interest.
Don’t be the person who doesn’t pay, because it isn’t cool.
Disposable Income and Budget
Mike Knight
Definitions
Disposable income: The amount of money that households have available for spending and saving after income taxes have been accounted for.
Budget: An estimate of income and expenditure for a set period of time.
Explanation
The disposable income of a household is predicted in a budget, which predicts how much you make and gives parameters for how much you can spend. The disposable income is the money allowed for expenditure in the budget.
Visual
Disposable income
Bills Payments Taxes
Income
Budget predicts Expenditure allowed in budget
Connection
A households whole income is like a pie. Your friends take their portions of the pie, this represents taxes, bills, any mandatory payments. What you have left is what you can eat. This is your disposable income. Your budget is what you would have predicted. You would have predicted how much your friends would eat, and so you readied yourself to have this certain amount of pie left to eat, or in our case, money left to spend.
http://www.investopedia.com/video/play/preferred-stock-vs-common-stock/
John Maynard Keynes
a British economist whose ideas have greatly affected the theory and practice of modern macroeconomics
Keynes
• supported the use of government monetary and fiscal policy to maintain full employment without inflation
• He wrote Tract on Monetary Reform and Treatise on Money– major policy view was that the way to stabilize the
economy was to stabilize the price level• Keyne’s theory General Theory showed that full employment
could by maintained only with the help of government spending
Connection
The key to full employment is he usage of government monetary and fiscal policy
Capital- wealth in the form of money or other assets owned by a person or organization or available or contributed for a particular purpose such as starting a company or investing.
Goods- merchandise or possessions
Services- the supplying of commodities
Capital; Goods & Services
Concept of CapitalCapital in a nutshell is what money/assets you need to get your business started . Usually people take loans from banks.
Goods and Services relationshipGoods are things that you want to buy, and services are like labor and jobs that aren’t material items.
CapitalThe bank is lending
money to the business
Bank
Business
The difference between Goods and Services activity
www.econedlink.org/interactives/index.php?iid=101&type=student
Supply and Demand
Andrew Goldberg
The amount of a commodity, product, and
service available and the desire of buyers for it, considering as factors regulating its price.
What is it?
A company is trying to sell a product. If the cost to produce is up, the cost of the
product goes up. Known as the Law of Supply. Not so fast… When the production cost rises, consumer
demand goes down. Known as the Law of Demand.
What does that mean?
It’s the year 2050, and cardboard boxes are
the hottest item on the market! Consumers cannot get enough of this exciting product. Big Box Inc. is struggling produce enough boxes to meet their costumers demands. It’s the holiday season, and everyone is traveling to the stores to buy a box. Based on supply and demand, will their price be up or down?
Let’s play a game
Microeconomics&
MacroeconomicsGeorgina Garvey
Definition Microeconomics- Study of the economic
behavior of individual consumers, firms, and industries and the distribution of total production and income among them.
Macroeconomics- Study of the entire economy in terms of the total amount of goods and services produced, total income earned, level of employment of productive resources, and general behavior of prices.
Explanation Macroeconomics- the study of the
large economic systems of a country or region. A more broad study of the economy of the entire country.• Analyze economic growth, price stability,
and full employment
Explanation Microeconomics- the study of the
economic decisions and actions of individual people, companies, etc. More specific study of economics• establish relative prices among goods and
services and distribute society's resources among their many possible uses.
macroeconomics
Macroeconomics: The BIG picture
Microeconomics: looking at things on a smaller more specifi c
scale
KARL MARXSarah Devlin
Definition
Founder of modern communism Advocate for communism; believed
capitalism contained the “seeds of its own destruction”
Helped write The Communist Manifesto
Concept
Believed communism is the inevitable
His work called for the overthrow of capitalism
“From each according to his abilities, to each according to his needs”
Some points of Marxism… No property or ownership
of land Income tax relates to
income (the more you make the more you pay)
Free education in public schools, no child labor
Factories of production owned by the state
equal obligation of all to work and the establishment of an industrial and agricultural armies
Undervalued non-economic forces
Didn’t take culture and tradition into account
Supporters believed it would give the working class a better life
Reactions/ Problems
“Workers of the world unite; you have nothing to lose but your chains”
Connection
Karl Marx- Communism
Capitalism
Adam SmithRagini Devala
free-market economist famous for his ideas about the efficiency of the division of labor and the societal benefits of individuals' pursuit of their own self-interest.
Definition
Father of economics World’s first free-market capitalist An Inquiry into the Nature and Causes of the Wealth
of Nations first work dedicated to the study of political economy Most of the ideas weren't his but he was the first
person to publish the ideas in a way that any reader can understand
Laissez-faire philosophies and the idea of “invisible hand” were promoted from Smith
Concept
Wanted to reduce the amount of effort to produce a product Assembly line
Handful of pins (1 man) vs. thousands of pins (10 men- assembly line)
Self-interested individuals can work together peacefully and productively
Concept cont’d…
Adam Smith = Self-interest Adam Smith = Assembly Line
Connection