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ECONOMICS

D AY 1 – M O N D AY, J A N U A RY 8 T H

MONDAY, JANUARY 8TH

• Good morning/afternoon!

• As you enter, please:

– Sit in your Synergy number seat

– Front table – pick up your Econ Preview Word Search and

complete it.

• We’ll take attendance and get started with our Econ Pretest in

just a moment!

CLASS UPDATES

• Regular bell schedule today

• Reminders:

– Next Tuesday the following items are due:

• Completed and signed Syllabus

• Class Materials

SHIFTING INTO ‘TEST MODE’

• Please:

– Clear off your desk

– Log on to your laptop and wait for further instructions.

Laptops

Log-on

Click on iRespond Web App

If you don’t have it, go to web

browser > iRespond.cobbk12.org

Go to:

Georgia.Powell

Password: Your Lunch #

PCs

Log-on

Click on iRespond Web App

Go to:

Georgia.Powell

go to Econ Pretest

ECONOMICS PRETEST

• During any assessment (even a pretest) please remember:

– No talking

– No squawking (no disruptions)

– No gawking (eyes on your own paper)

– No walking (raise your hand & I’ll come to you)

– No electronics – until all tests are turned in.

– When you’re done with your Pre-test raise your hand and I’ll bring you

your Techie Scavenger Hunt so you can get started!

TECHIE SCAVENGER HUNT!Goal

To have fun

while you

get on-board

with all our

class

technological

tools!

TECHIE SCAVENGER HUNT!

Step #1 – CCSD WIFI

(don’t use up your data!)

Instructions are available for:

• Apple iOS phones

• Android phones

• cobbwireless

If additional help is needed, Mr. Hoeh

from Cobb County Instructional

Technology will be here tomorrow to

help you.


Step #2 – QR Code Reader

Go to your phone’s App Store and

download a free QR Code Reader.

There are lots of free options. Check the

consumer ratings to decide which is your

best bet!


Step #3 – Office 365

If you already have your Office 365 logon, then

just login and scan the QR code to complete

your survey.

[email protected]

If you don’t already have Office 365, follow the

instructions for your phone to set it up. Then

you can scan the QR code to complete your

survey.


Step #4 – GCEE Phone App

Once again, go to your phone’s App Store to

find the GCEE Phone App with lots of great

practice questions to help you prep and ace

your economics tests!


Step #5 – Class Website

1. Using your favorite web browser, go to our

class website gpowell6.weebly.com

2. Scan the QR code to access the survey

3. Then tour our website to answer all the

questions

• Hint: some tabs are located to the far right,

so you have to scroll over to find them…

gpowell6.weebly.com


Step #6 – Google Classroom

1. You need a Google email account (gmail), so

if you don’t have one you’ll need to create

one.

2. Then go to Google Classroom and you

should be able to see our class and join our

class!

3. If needed, our Class Syllabus and website

also has the class codes for your Google

Classroom.


Step #7 – EverFi.com

1. Go to EverFi.com, create an account and

join our class

2. If needed, our Class Syllabus and website

also has the class codes for your Google

Classroom.


Step #8 – Remind Phone App

1. If you already have the Remind

phone app, then just join our class

2. If not, then go to your phone’s App

Store to download it (it’s free),

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Step #9 - Quizlet

1. If you already have the Quizlet phone app, then just join our class

2. If not, then go to your phone’s App Store to download it (it’s free), create

an account & join our class!

GENTLE REMINDERS!

• Due Tuesday, January 16th:

– Signed Class Syllabus

– Class Materials Check

SIGNED CLASS SYLLABUS

Need your

checked & signed

Syllabus back by

no later than

Tuesday, January

16th!!

CLASS MATERIALS

UNIT ONEFUNDAMENTALS OF ECONOMICS• Economics Unit One Summary – Let’s take a tour!

TWO WAYS TO DO YOUR VOCABHand-Written (no typed!)

• Write out your definitions

(neatly and completely) on your

own lined paper.

• Label each of your papers as

instructed.

Quizlet

1. Practice with electronic flash

cards and memory games

2. Then make at least an 80 on

the electronic test.

Do Both for

Bonus Points!!OR

UNIT ONEFUNDAMENTALS OF ECONOMICS

You can complete your

Study Guide as we progress

through the unit!

1. Use the same heading on your

Study Guide pages

2. Write down the question and

underline it

3. Answer the question

4. Leave a blank line between questions

to make it easier to read

ECONOMICS UNIT SUMMARY

• This is a fantastic, easy to

understand summary of everything

you need to know for each unit

sorted by each learning standard.

• We’ll be using each day with our

‘Expedition Econ’ openers.

• To receive maximum points you’ll

need to read your Unit Summary by

‘Power Reading’

• So keep this in the front of your

Unit Papers in your notebook so

that’s easy to find and review.

Get the most out of your reading by doing…

Power Reading!1. This assignment is meant to be read one

Learning Standard at a time.

2. Read the Learning Standard explanation

highlight the important information

circle words/phrases you don’t know or

understand

underline the most important concepts

really think about what you’ve read!

1. Then, read the questions for that Learning

Standard and see if your highlighted info

answers the question/s – if so, you have what

you need to answer the question!

2. If not, reread the passage looking for the

necessary info or needed clarifications.

ECONOMICS

D AY 2 – T U E S D AY, J A N U A RY 9 T H

WEDNESDAY, JANUARY 10TH


• As you come in, please:

– Sit in your Synergy number seat

– Turn in your

• Techie Scavenger Hunt sheet with your name on it

• Signed Syllabus

– Front Table – pick up:

• Unit One Objectives

• Expedition Econ – Day 1

CLASS UPDATES

• Transcript checks

• Reminders:

– Friday – Unit One Formative

• Study with:

– Quizlet vocab,

– class notes,

– Learning Standards through Thursday

– Tuesday:

• Completed and signed Syllabus due

• Class Materials Check

SIGNED CLASS SYLLABUS

Need your

checked & signed

Syllabus back by

no later than

Tuesday, January

16th!!

CLASS MATERIALS

UNIT OBJECTIVES/SUMMARY

• New series of openers utilizing our Unit Objectives/Vocabulary/Learning

Standard Summaries

– At the beginning of each unit you’ll receive a Unit Summary which includes:

• Unit Learning Standards

• Unit vocabulary

• Unit Study Guide

• Unit core content sorted by learning standard!

UNIT ONEFUNDAMENTALS OF ECONOMICS• Economics Unit One Summary – Let’s take a tour!

TWO WAYS TO DO YOUR VOCABHand-Written (no typed!)

• Write out your definitions

(neatly and completely) on your

own lined paper.

• Label each of your papers as

instructed.

Quizlet

1. Practice with electronic flash

cards and memory games

2. Then make at least an 80 on

the electronic test.

Do Both for

Bonus Points!!OR

UNIT ONEFUNDAMENTALS OF ECONOMICS

You can complete your

Study Guide as we progress

through the unit!

1. Use the same heading on your

Study Guide pages

2. Write down the question and

underline it

3. Answer the question

4. Leave a blank line between questions

to make it easier to read

EXPEDITION ECON

• New series of openers which prompts you to

read your Unit Summary and gain initial

understandings of today’s learning standard

• Follow the headings to find the Learning Standard,

Power Read the passage on that Learning

Standard and answer the questions.

• Then move on to the next Learning Standard and

repeat!

Get the most out of your reading by doing…

Power Reading!1. This assignment is meant to be read

one Learning Stand at a time.

2. Read the Learning Standard

explanation

highlight the important information

circle words/phrases you don’t know

or understand

underline the most important

concepts

really think about what you’ve read!

1. Then, read the questions for that

Learning Standard and see if your

highlighted info answers the

question/s – if so, you have what you

need to answer the question!

2. If not, reread the passage looking for

the necessary info or needed

clarifications.

TODAY’S LEARNING STANDARD

• SSEF1 Explain why limited productive resources and unlimited wants result in

scarcity, opportunity costs, and tradeoffs for individuals, businesses, and

governments.

a. Define scarcity as a basic condition that exists when unlimited wants exceed limited

productive resources.

b. Define and give examples of productive resources (i.e. factors of production): natural

resources (i.e. land), human resources (i.e. labor and human capital), physical capital and

entrepreneurship.

c. Explain the motivations that influence entrepreneurs to take risks (e.g., profit, job

creation, innovation, and improving society).

d. Define opportunity cost as the next best alternative given up when individuals,

businesses, and governments confront scarcity by making choices.

LIVING ECON EVERY DAY!• Think back to when you were younger…

– When you were really young is there anything

you wished you had more of?

– How about middle school?

– How about yesterday?

– How about today?

• Why couldn’t you have all that you wanted? What was

the problem?

• How did you resolve the situation?

HOW MUCH WOULD YOU PAY?

BIG ECONOMIC IDEA – SCARCITY• Because we have unlimited wants and very limited resources we will

ALWAYS have scarcity.

• No matter how wealthy someone is – they always want more

• Scarcity is relative:

– what is precious/valuable (i.e. scarce) to you may

not mean anything to someone else

– Timing

– Needs

WANTS VS. NEEDS

To understand scarcity we need to remember the

difference between wants and needs:

Need

Things we need for survival – air, food, water, shelter, cloths

(not cell phones!)

Wants

Things we desire but are NOT essential for survival.

(yes – that’s a cell phone!)

SCARCITY AND CHOICE

• Because our limited resources won’t allow us to

have everything we want/need, we have to make

choices.

ECONOMICS

• Economics is the study of how we try to

satisfy our needs and wants by

making choices.

• Because people act:

– individually,

– in groups (such as businesses) and

– through governments

economists study each of these groups.

CONNECTING THEMES IN ECONOMICS

• Each of the six content units in this course will connect to four

main themes.

1. Scarcity – The effect of limited resources on making choices.

2. Voluntary Exchange - The ways in which people gain from trade

3. Incentives - The role of incentives in making choices (Ex. Profit

Motive)

4. Economic Interdependence - The costs and benefits of

interdependency between two or more individuals, businesses,

and/or nations

WHAT IS ECONOMICS?

• The study of Money? • The study of the economy? • The study of choices?

• Economics is the study of how individuals and nations make

choices about how to use their scarce/limited resources to fill

their unlimited needs and wants.

• Microeconomics- Deals with individual units of the economy.

– Individual Units can mean a person, a family or a community

• Macroeconomics- Deals with the economy on a national or

global level

WHO MAKES THE DECISIONS?

• Consumers- make decisions on what to buy

• Producers- make decisions on what to produce

Possible products fall into two categories:

• Goods- physical objects to purchase

• Services- actions/activities performed for a fee

SCARCITY AND PRICES

• In market economies (like ours) scarcity determines availability and therefore

price.

ThinkWrite it down & think about it

on your own

Pair Discuss with your neighbor & write

down your thoughts on the topic. Be

prepared to share with the class.

ShareAfter sharing your ideas & listening

to others, write down your

conclusions below

What items are scarce &

expensive? Why?

What items aren’t scarce but are

still expensive? Why

Can you think of any items that

are scarce and NOT expensive?

RESOURCES

Anything that people use to make or obtain what they need or

want is called a…resource.

• In economics, resources are sometimes called inputs.

• Resources that can be used to produce goods and services are

called FACTORS OF PRODUCTION.

CHECKPOINT QUESTION #1

Opportunity cost is BEST described as the

A. most expensive resource used in production

B. sum of all production costs

C. value of the best alternative forgone (given up) when a choice is made

D. monetary value of all alternatives forgone (given up) when a choice is made


. The two types of products are…

A. human resources and capital resources

B. producers and consumers

C. goods and services

D. shelter and transportation


A person who makes goods or provides a service is acting as…

A. an economist

B. a consumer

C. a producer

D. none of the above

SCARCITY RESOURCE GAME

ECONOMICS

D AY 3 – W E D N E S D AY, J A N U A RY 1 0 T H

THURSDAY, JANUARY 11TH



– Sit in your Synergy # seat

– Front table:

• Turn in your signed Syllabus (last day is Tuesday)

• pick up your Expedition Econ and complete it by reading your

Unit One Economic Summary!

– Front side – Learning Standards – SSEF1 c & d

– Back side – Learning Standard – SSEF2 a, b & c

CLASS UPDATES• Key Dates to Remember:

– Tomorrow – Unit One Formative

• covers Learning Standards SSEF1 &SSEF2, scarcity, factors of production,

opportunity cost

– Monday – MLK Holiday –Yay!

– Tuesday –

• Signed Syllabus due

• Class materials check

– Friday –

• Unit One Summative

• All Unit papers due!

CLASS UPDATES

• Reminders

– Keep completing your Unit Study Guide as we move through the unit – don’t wait until the night

before the test!

– Keep signing up for our class websites

QUIZLET• Congratulations to the following students who have joined our classes!

First BlockDalila

Jose

Davionne

Not sure who you are!

Jaasdm

Rivera_Estrada

Please go in and change

your sign-on name so I

know who you are!!

Second BlockAmy

Elila

Katie

Nik

Nyima

Chantz

Yasmid

Not sure who you are!

MajesticBells

Please go in and change

your sign-on name so I

know who you are!!

Fourth BlocDennis

McKenzie

QUIZLET

• If you haven’t already, please still join our class!

– Two ways –

• Phone App

• PC based

• Class Codes:

– First Block https://quizlet.com/join/xD2FmUppg

– Second Block https://quizlet.com/join/maCQZ7fFe

– Fourth Block https://quizlet.com/join/YzV75fWQv

CLASS UPDATES

• Remember to keep checking our class website!

gpowell6.weebly.com

Password: PHS Falcons


• SSEF1 Explain why limited productive resources and unlimited wants result in

scarcity, opportunity costs, and tradeoffs for individuals, businesses, and

governments.

a. Define scarcity as a basic condition that exists when unlimited wants exceed limited

productive resources.

b. Define and give examples of productive resources (i.e. factors of production): natural

resources (i.e. land), human resources (i.e. labor and human capital), physical capital and

entrepreneurship.

c. Explain the motivations that influence entrepreneurs to take risks (e.g., profit, job

creation, innovation, and improving society).

d. Define opportunity cost as the next best alternative given up when individuals,

businesses, and governments confront scarcity by making choices.

ECONOMICS DEALS WITH THE STUFF WE NEED TO MAKE OTHER STUFF• Factors of production are the economic resources needed to

produce goods and services.

• There are four factors of production:

1. Land

2. Labor

3. Capital

4. Entrepreneurs tie land, labor &

capital together into a productive enterprise.

• Each is limited in supply (scarcity)

FOR ECONOMISTS, LAND IS MORE THAN DIRT

Land: all the natural resources found on or under the ground that are used

to produce goods and services.

Water Iron Plants

Forests Coal Animals

Fish Oil

• Land resources are the raw materials in the production process.

– These resources can be renewable, such as forests, or nonrenewable such as oil

or natural gas.

• The income that resource owners earn in return for land resources is called

rent.

THINK ABOUT IT!


on your own






conclusions below

Why wouldn’t a parking lot be

considered a land factor of

production?

FOR ECONOMISTS, LABOR IS MORE THAN ELBOW GREASE• Labor: all the human time, effort and talent used to produce goods & services

– Labor resources include the work done by the waiter who brings your food at a local

restaurant as well as the engineer who designed the bus that transports you to school.

– It includes an artist's creation of a painting as well as the work of the pilot flying the

airplane overhead.

• If you have ever been paid for a job, you have

contributed labor resources to the production of

goods or services.

• The income earned by labor resources is called wages

and is the largest source of income for most people.

THINK ABOUT IT!


on your own






conclusions below

Why would a heart surgeon and

a construction worker fall under

the labor factor of production

category?

FOR ECONOMISTS, CAPITAL IS MORE THAN MONEY

Capital: Resources made and used by people to

produce and distribute goods and services.

Tools Factories Computers

Machinery Offices Cell Phones

Roads Airports

• In addition to the physical capital examples above, there is also human

capital – what’s added (in terms training, education and increased

experience) to the labor force

• Man-made, transferable, depreciates

• The income earned by owners of capital resources is interest.

FOR ECONOMISTS, IT MATTERS WHO GETS THE BALL ROLLINGEntrepreneurship: the bringing together of all the factors using

ingenuity, skill, vision and a willingness to take risks necessary for starting

a new business enterprise.

– The most successful entrepreneurs are innovators who find new

ways produce goods and services or who develop NEW goods

and services to bring to market.

• Entrepreneurs thrive in economies where

they have the freedom to start businesses

and buy resources freely.

• The payment to entrepreneurship is profit.

THINK ABOUT IT!


on your own






conclusions below

Can someone start a new

business without taking a risk?

HOW THESE FACTORS ARE INTERCONNECTED IS CRITICAL

CHECKPOINT QUESTION

Which of the following is a capital resource?

A. iron ore

B. trained construction worker

C. industrial machinery

D. haircut

CHECKPOINT QUESTION

Steel, that will be used to produce washing machines, is purchased in a:

A. Factor (of production) market as capital

B. Product market as a consumer good

C. Factor (of production) market as a consumer good

D. Product market as a natural resource

FACTORS OF PRODUCTIONSTAND AND SORT

• Everyone should be getting a factor of production.

– Keep it face down until I tell you to turn it over

– When I tell you, turn it over

• Think about what type of factor of production it is and stand

under the sign for your Factor

– Talk with your Factor-mates & decide if you’re in the right spot!

• Be prepared to double-check and discuss

ECONOMICS

D AY 4 – T H U R S D AY, J A N U A RY 1 1 T H

FRIDAY, JANUARY 12TH



– Sit in your Synergy # seat

– Turn in your signed Syllabus

• final due date – Tuesday!

SHARK TANK!

• Shark Tank, the critically acclaimed and multi-Emmy® Award-winning reality show has

reinvigorated entrepreneurship in America.

• The Sharks – tough, self-made, multi-millionaire and billionaire tycoons – continue their search

to invest in the best businesses and products that America has to offer. The Sharks will once

again give people from all walks of life the chance to chase the American dream and potentially

secure business deals that could make them millionaires.

• The Sharks are:

– billionaire Mark Cuban, owner and chairman of AXS TV and outspoken owner of the 2011 NBA

champion Dallas Mavericks;

– real estate mogul Barbara Corcoran;

– "Queen of QVC" Lori Greiner;

– technology innovator Robert Herjavec;

– fashion and branding expert Daymond John; and

– venture capitalist Kevin O'Leary.

TIME FOR OUR FIRST FORMATIVE!

• Please clear your desk and power-down all electronics.

• When you get your Zipgrade bubble-sheet, please double-

check you got the correct one.

TEST MODE

• Until the LAST papers are turned in (and I let you know we’re done)

– No electronics

– No talking

– No squawking

– No walking

– No gawking!

TODAY’S LEARNING STANDARDSSSEF1 Explain why limited productive resources and unlimited wants result in scarcity, opportunity costs, and tradeoffs for individuals, businesses, and governments.

a. Define scarcity as a basic condition that exists when unlimited wants exceed limited productive resources.

b. Define and give examples of productive resources (i.e. factors of production): natural resources (i.e. land), human resources (i.e. labor and human capital), physical capital and entrepreneurship.

c. Explain the motivations that influence entrepreneurs to take risks (e.g., profit, job creation, innovation, and improving society).

d. Define opportunity cost as the next best alternative given up when individuals, businesses, and governments confront scarcity by making choices.

SSEF2 Give examples of how rational decision making entails comparing the marginal benefits and the marginal costs of an action.

a. Define marginal cost and marginal benefit.

b. Explain that rational decisions occur when the marginal benefits of an action equal or exceed the marginal costs.

c. Explain that people, businesses, and governments respond to positive and negative incentives in predictable ways

ENTREPRENEURS

• The ‘secret sauce’ of economic success!

• Shark Tank Top 10

https://www.youtube.com/watch?v=pjKbagr2Bvg

ENTREPRENEURS – RISKS & RETURNS

• Entrepreneurs take major financial risks, work long

hours and practically torture themselves trying to stay afloat and

build a business from the ground up.

– Why would anybody want to go through with it?

• The obvious answer is profit (the money that is left after all

expenses have been paid)!

• The less obvious reasons include:

– Control over their destinies

– Flexibility

– The fulfillment of job creation, innovation and improving society

– Ultimately the hope of a lasting legacy – personally and

professionally!

EVEN ENTREPRENEURS EXPERIENCE SCARCITY

Every single person on Planet Earth

WANTS more than they can afford!

Even Jeff Bezos!

SHARK TANKBONUS POINTS OPPORTUNITY!

If you enjoy watching Shark Tank, do it for bonus points!

Each unit, you can

• watch up to two episodes of Shark Tank

• analyze each episode with the Entrepreneurship Breakdown sheet

(Episode #1 on one side and Episode #2 on the other side)

– Quality analysis needed, streaming the episode helps so you can stop it and write things

down as you watch

• Turn your completed Entrepreneurship Breakdown analyses sheet with your unit

papers before the Unit test to gain a bonus point assignment.

– Individual analysis, no copying each other’s papers!

OPPORTUNITY COST

• Opportunity cost is what you must give up to obtain

something else, the second-best alternative.

– Every time we make a choice we have an opportunity cost!

• Opportunity cost can be anything (time, sleep, pleasure, stress) as long as it’s our second best

choice.

THINK ABOUT IT!ThinkWrite it down &

think about it on

your own

Pair Discuss with your neighbor & write down your

thoughts on the topic. Be prepared to share with

the class.

ShareAfter sharing your ideas & listening to

others, write down your conclusions

below

Feel like pizza? Name all your options for pizza

Underline your #1 choice

What’s your #2 choice (i.e. Opportunity Cost)

___________________

Everything else is a _____________________

MARGINAL BENEFITS AND COSTS

• Economic decisions are always made on the basis of marginal

costs and marginal benefits.

– So what is marginal??

Always additional – specifically ONE more!

• Marginal cost of producing a good is the additional cost of

producing one more unit of the good.

• Marginal benefit of consuming a good is the additional value of

consuming one more unit of it.

RATIONAL DECISION-MAKING

Rational (logical) decisions are reached when:

• marginal benefit is equal to (or greater than) marginal cost.• https://www.youtube.com/watch?v=WQdbdPFEwSo

https://www.youtube.com/watch?v=WQdbdPFEwSo

THINK ABOUT IT!ThinkWrite it down &

think about it on your

own


thoughts on the topic. Be prepared to share with

the class.



below

Brainstorm all the benefits of winning an Olympic

medal

Brainstorm all the costs involved in becoming an

Olympic champion

Are the marginal benefits equal (or greater than)

the marginal costs?

Incentives are anything that motivates action from people, businesses and even

governments

There are two kinds of incentives:

1. Positive Incentives Motivation to gain a perceived benefit

Examples: savings, sales, discounts, promotion

2. Negative Incentives Motivation to avoid a perceived punishment, cost

Examples: fines, prison, tax, penalties

INCENTIVES

THINK ABOUT IT!ThinkWrite it down & think

about it on your own


thoughts on the topic. Be prepared to share with the

class.



below

Sort the following by

whether they are positive

or negative incentives

50% off sale

Buy-one-get-one-free

Library fines

Income tax credit

Traffic ticket

Subsidy

Low interest loans

“Order in the next 2

minutes!”

Examples of positive incentives

Examples of negative incentives

EFFICIENCY• In economics, efficiency means:

– Getting the most outputs (goods or services) from your inputs (factors of

production)

– Not wasting any of your inputs (not a second or a drop!)

– People are always trying to be

more efficient…but how?

WAYS TO BECOME MORE EFFICIENT

• The division of labor refers to the practice that the tasks of

producing a good or service are divided up into separate tasks.

• When workers focus on performing separate tasks, specialization

occurs.

• Specialization is when workers gain

experience and training to become a

specialist/expert at what they do – so

they can perform their task as efficiently

as possible

DIVISION OF LABOR AND SPECIALIZATION

• Within the economy as a whole, the division of labor explains why even if you

bake your own bread, you typically don't grow your own wheat, grind it into

flour, build your own oven, make your own bread-pans and so on.

• Instead, people specialize in a few skills and then take the wages that they earn

from those skills to purchase the other goods and services that they desire

from other specialists.

• In this way, the division of labor and specialization is the basis for an economy

to exist.

ADAM SMITH THE WEALTH OF NATIONS

• Adam Smith started his classic book The Wealth of Nations with a discussion of

the division of labor as the basis for understanding how an economy works.

• He identified three reasons why the division of labor increases output:

1. workers who specialize on one job become much better at doing it;

2. with specialization, the time that it would take to switch between jobs is

eliminated;

3. workers who specialize on one job often invent more effective ways or new

machines for doing the job.

ADAM SMITH THE WEALTH OF NATIONS

• But as Adam Smith makes clear, specialization is possible only when people are

able to coordinate their production and consumption decisions with each other.

• The study of economics is largely concerned with explaining how this

coordination takes place.

VOLUNTARY EXCHANGE• People do not make everything that they and their family use: that is,

– They do not grow all their own food,

– Sew their own clothes,

– Build their own house and

– Provide themselves personally with health care and education.

• Instead, people focus on a particular job and

then use the wages that they earn from that job

to purchase the goods and services they desire.

• In this way, an economy forms an interlinked

network of trade, exchange and

interdependence.

VOLUNTARY EXCHANGE

• Specialization is the basis of trade and interdependence among individuals,

cities, regions and countries.

– Most countries do not produce all of what they consume.

– Instead, they focus more heavily on producing certain products and trading with

other countries.

• Thus, the global economy is a network of trade and interdependence.

• When trade is voluntary and non-fraudulent, both parties in the trade gain.


Opportunity cost is BEST described as the

A. most expensive resource used in production

B. sum of all production costs

C. value of the best alternative forgone (given up) when a choice is made

D. monetary value of all alternatives forgone (given up) when a choice is made


When the government lowers taxes this acts as a _________________ incentive to spend?

a. Positive

b. Negative


How does division of labor and specialization help people, companies

and governments become more efficient?

POWELL PAPER CHAIN FACTORY

• We need three volunteers please!

1. Factory Worker

2. Data Manager

3. Results Charting Manager


• Today we’re going to see how to make paper chains as efficiently

and effectively as possible!

• While we watch our factory worker, data manager and results

charting manager do their thing, we’ll be capturing the same

information on our own Paper Chain Factory info sheets.


• What the audience needs to do:

– Get out your colored pencils and color code your Data Key

– When each round is completed, fill in your data chart (just like the Data Manager on the whiteboard.

– At the end, the results graphing manager will do their thing on the whiteboard with your help and then you can copy it on your sheet of paper.

– Then we’ll discuss!


• What are our Four Factors of Production?

• Last but not least – the Entrepreneur!

Factor What is it?

Land (from Mother Nature)

Labor (Muscles & Brains)

Capital (Tools, Machines…)


Round # # of Workers

QL

Total Product

TP

Marginal Product

(=change in TP)

Average Product

(TP/QL)

1

2

3

4

5

6


• Let’s graph

what

happened:O

utp

ut

(to

tal,

mar

gin

al &

ave

rage

)

Number of Workers (QL)

A COUPLE OF THOUGHTS BEFORE YOU HEAD OUT FOR A GLORIOUS WEEKEND!

• Great week!

• Hope you enjoy your weekend!

• Over the weekend – just a little to do

– Econ Everywhere – use your unit

summary to Power Read and find

the answers

– Vocab – practice, practice!

– Study Guide – lower the stress

level – complete 5-6 questions/

night!

ECONOMICS

D AY 5 – T U E S D AY, J A N U A RY 1 6 T H

TUESDAY, JANUARY 16TH



– Sit in your NEW assigned seat (see diagram for more details) based on our Unit One

Formative results from Friday

– Front Table:

• Turn in your signed Syllabus (if you haven’t already)

• Pick up your Expedition Econ – Day #4 and complete it using your Unit One Summary pages

• Pull out your class materials for me to check (leave them on the edge of your desk to make

things easier)

– 3 ring notebook

– Divider pages

– Colored pencils/highlighter/regular pens & pencils

– Loose leaf lined paper


SSEF4 Compare and contrast different economic systems and explain how they answer

the three basic economic questions of what to produce, how to produce, and for whom

to produce.

a. Compare traditional, command, market, and mixed economic systems with regard to private

ownership, profit motive, consumer sovereignty, competition, and government regulation.

b. Analyze how each type of system answers the three economic questions and meets the broad

social and economic goals of freedom, security, equity, growth, efficiency, price stability, full

employment, and sustainability.

c. Compare and contrast strategies for allocating scarce resources, such as by price, majority rule,

contests, force, sharing, lottery, authority, first-come-first-served, and personal characteristics

ECONOMIC SYSTEMS

• An economic system is a system of

production and exchange of goods and

services as well as allocation of resources

in a society.

• The system is determined by who answers

the 3 basic economic questions

1. What goods & services to produce?

2. How should these goods & services be produced?

3. Who gets to consume these goods & services?

TRADITIONAL ECONOMY

• Traditional Economy – an economic system that is based on customs and beliefs.

– People will make what they’ve always made.

– They do things the same way as their parents and grandparents.

– People are not free to make their own decisions on what they want.

• Often involves bartering – exchanges with no money involved

• Examples of these societies do not really exist any more. Native American societies and India in the past were like this.

COMMAND ECONOMIES

• Command Economy – One in which a central authority

makes all economic decisions about how best to

allocate resources.

• Examples of these economies include

Cuba, North Korea, and China.

http://dailysignal.com/2015/07/28/escape

d-refugee-hyeonseo-lee-reveals-what-

life-is-like-in-north-korea/

http://www.usatoday.com/story/news/world/20

13/04/13/north-korea-factoids/2078831/

MARKET ECONOMY

• Market Economy – system where the laws of supply and demand

direct the production of goods and services

• Buyers and sellers answer the economic questions as they come

together to exchange goods and services.

– Buyers/consumers are king!

Sometimes called consumer sovereignty.

• Examples include the USA, Great Britain and Japan

MIXED ECONOMY

• Market + Command = Mixed Economy

• Technically there are no pure market or command economies.

To some extent, all existing economic systems demonstrate

characteristics of both systems and can be called mixed

economies.

– Economies are usually closer to one type of

economic system than the other.

• People/businesses own most resources and

determine what & how to produce, but the

government may regulate certain industries.

CONTINUUM OF ECONOMIC SYSTEMS

https://www.youtube.com/watch?v=5xgwYRX19VU

ECONOMIC SYSTEMS STAND AND SORT

• Each of you will receive a descriptor strip facedown. Leave it facedown until I tell you to turn

it over.

– Notice our Economic Systems signs around the room.

• When instructed, turn over your descriptor strip then

– Think about which economic system it describes

– Go stand by the economic system sign you believe fits

• Discuss with others at your economic system – are you with the right economic system – be ready to

share in a minute

– After sharing, tape your description strip on our anchor chart under the correct economic system!

PAPER AIRPLANE ECONOMIES

• Pick a slip to see what type of economy you’ll be

working with.

• When instructed, to the set of desks for your

economic system.

• Read the directions for your economy.

• Do NOT start until you’re instructed to do so!

ALLOCATION STRATEGIES

Allocation strategies are the methods available to societies as they

seek to answer the third economic question of who receives what has

been produced.

• Following are a few allocation strategies:

– Price - the forces of supply and demand to determine a market price

– Authority - based on the decisions of a power person or group of people

who make most of the decisions about who gets to obtain a good, service, or

factor of production

– Force - goods, services, and factors of production are given or taken away

under using threats

ALLOCATION STRATEGIES

• Following are more allocation strategies:

– Lottery - random selection, gives everyone who wants the good, service, or

factor of production equal odds of obtaining it

– First come, first served - allows people to receive a good, service, or factor

of production if they get to it first or are one of the people close enough to

the front of the line to receive the good, service, or factor of production

before there are none remaining.

– Majority rule - a group of people who have control over a good, service, or

factor of production vote to decide how it will be distributed

– Personal characteristic - resources to be distributed based on need or

merit

Who Gets the Cookies?

1. There are four people in a group.

2. Write the name of each of your group members in

the space beside the word “alternatives.” What

does alternatives mean?

3. Leave “criteria” blank. We will do this together!

1. Write majority rule in the first blank under

criteria.

2. Give each person 10 seconds.

3. In 10 seconds tell the group why you should get

the cookies.

4. Vote for each person.

5. Give the person with the most votes a (+) and give

everyone else a (-) sign.

1. Write random selection in the second blank

under criteria.

2. Ask group members to write their names on slips

of paper. Fold up the slips.

3. The teacher will pick a slip for each group.

4. Give the person whose name was picked a (+) and

give everyone else a (-) sign.

1. Write authority in the third blank under criteria.

2. The person’s name chosen for random selection

(lottery) is now the king or queen.

3. The king or queen commands that one person in

the group (other than him- or herself) should get a

(+) sign. Everyone else gets a (-) sign.

1. Write competition in the fourth blank under criteria.

2. Play best out of three in a game of rock-paper-scissors

with a partner in your group.

3. The winning partner will play the other winning partner.

4. The final winner should get a (+) sign. Everyone else gets

a (-) sign.

1. Count up the total (+) signs for each person.

2. The person with the most (+) signs gets the cookies.

Who Gets the Cookies?

1. Which allocation strategy do you think is most efficient? Why?

2. Which allocation strategy do you think is most fair? Why?

3. What do you think is more important, economic efficiency or economic equity

(fairness)? Why?

4. How satisfied were you with the methods used to allocate the cookies? Explain.

5. What benefits and/or costs do you foresee if our government allocated public goods

and services in the same way?

6. Look at the full list of allocation strategies. For each of the strategies, identify one

thing in the United States that we allocate using that strategy.

7. Look at the full list of social economic goals. Which two goals do you think are valued

most highly in the United States? Give evidence to support your assertion.

ECONOMIC GOALS

• https://study.com/academy/lesson/economic-goals-for-the-us-economy.html

https://study.com/academy/lesson/economic-goals-for-the-us-economy.html

SOCIAL ECONOMIC GOALS MINI-POSTER

• Use your wonderful colored pencils to illustrate each of our social economic goals.

• Due tomorrow at the beginning of class.

ECONOMICS

D AY 6 – W E D N E S D AY, J A N U A RY 1 7 T H

MONDAY, JANUARY 22ND



– Sit in your assigned seat

– Front table – pick up your Expedition Econ SSEF6 and start completing it

by Power Reading your Unit One Summary to find all the answers!

CLASS UPDATES

• Due to our wonderful winter weather days:

– Unit One test pushed back to this Wednesday (need a Kleenex?)

– We’ll be finishing up fast today and tomorrow (need 100% of your brain –NO distractions!)

– Remember:

• You should have been completing your Unit One Study Guide all along so this fast finish shouldn’t be too stressful (right?!?)

• Unit One Quizlet will be shutdown at midnight tomorrow so finish up

• Unit Assignment Cover Page will be distributed tomorrow. If you’ve been keeping everything in your 3-ring binder your life is low stress/low mess right now! (right?!?)

CLASS UPDATES

• Synergy has been updated for:

– Signed syllabuses

• Last call is by this Friday!

– Class materials

• Ditto – last call is this Friday to receive credit in Synergy

• Need to ask me in quiet times – before bell, during solo work, tutoring, etc. Do NOT ask me in the

middle of a lesson (taking off points is an option!)

– Techie sign-ups

• You’re getting a summary of what you’ve gotten credit for so far

• If you’re missing anything, get signed up by this Wednesday and return your Techie Sign-up Summary with

your Unit One papers BEFORE the test. I’ll update Synergy as needed.

CLASS UPDATES

• Stuff to Remember:

– Tutoring with Mrs. Powell

• Tuesday – Unit One Study Session!

• Thursday – Unit One celebration!!!

– Open House this Wednesday

• Hope to see you and your family there!

LET’S REVIEWSINCE LAST WEEK SEEMS LIKE A LONG TIME AGO…

Economic Systems Card Sort

• Each of you will get an Economic Systems graphic organizer and a set of

descriptor strips

• Work with a quad-mate to figure out which descriptor strip goes with each

economic system (remember - some descriptions may fit more than one

economic system!)

– When you think you’ve got it right – raise your hand and I’ll come check your work

– If you’re good-to-go I’ll give you a glue stick to glue it all down!


SSEF6 Explain how productivity, economic growth, and future standards of living are

influenced by investment in factories, machinery, new technology, and the health,

education, and training of people.

a. Define productivity as the relationship of inputs to outputs.

b. Explain how investment in equipment and technology can lead to economic growth.

c. Explain how investments in human capital (e.g., education, job training, and healthcare) can lead

to a higher standard of living.

d. Analyze, by means of a production possibilities curve: trade-offs, opportunity cost, growth, and

efficiency.

WHAT DOES THIS MEAN?

WHAT IS PRODUCTIVITY?

• We know from Friday that:

– Productivity is measured as the quantity of output per unit of input.

– Efficiency means getting the most output from your inputs (i.e. not wasting anything!)

• Increases in efficiency can be achieved through division of labor and specialization

• An increase in productivity means

– producing more goods and services with the same amount of resources,

– producing the same amount of goods and services with fewer resources or

– a combination of the two possibilities.

• Over time, productivity growth means that the average worker is producing

more per hour, which means that the average standard of living in the economy

will be higher.

INVESTING IN EQUIPMENT, TECHNOLOGY & EDUCATION

• Economic growth results when an economy can increase its total real output

or real GDP, or its real output per person.

• Economic growth comes from several sources:

– improvements in the education, experience and skill level of the workforce, sometimes called human

capital;

– greater amounts of physical capital, that is, plant and equipment per worker;

– improved technology.

• Economic growth is critical to job-creation and

economic well-being.

PRODUCTIVITY AND SCARCITY

• How does productivity co-exist with scarcity?

By making choices!

WHAT DO YOU THINK THIS MEANS?

ProductionWrite your ideas on the board!


PossibilitiesWrite your ideas on the board!


Production Possibilities

Write your ideas on the board!

HOW COULD YOU REPRESENT GRAPHICALLY ALL THE PRODUCTION POSSIBILITIES OF…

• A farmer who could

grow apples and/or

pears on their 6 acre

farm?

Introducing…

The Production Possibilities Frontier/Curve

Featuring the following simplifying assumptions…

1. a society that produces only two goods

2. the efficient use and full employment of resources

3. fixed technology

4. a single snapshot in time

Production Possibilities FrontierProduction Possibilities Frontier

Production Possibilities Frontier

A B C D E F G

units of

apples 6 5 4 3 2 1 0

units of

pears 0 1 2 3 4 5 6




Units of

Apples

Units of

Pears

units of

apples

units of

pears

A B C D E F G

units of

apples6 5 4 3 2 1 0

units of

pears0 1 2 3 4 5 6

6

5

4

3

2

1

1 2 3 4 5

6

A

B

C

D

E

F

G


PRODUCTION POSSIBILITIES…

Production Possibilities Frontier/CurveThe production possibility curve is a hypothetical representation of the

amount of two different goods that can be obtained by shifting resources from

the production of one, to the production of the other.

The curve is used to describe a society's choice between two different goods

Sometimes called the Production Possibilities Frontier

https://www.youtube.com/watch?v=O6XL__2CDPU

units of

apples

units of

pears

A B C D E F G

units of

apples6 5 4 3 2 1 0

units of

pears0 1 2 3 4 5 6

6

5

4

3

2

1

1 2 3 4 5 6

A

B

C

D

E

F

G


Illustrates Opportunity Cost

Opportunity Cost =

What you give up if you choose something else

units of

apples

units of

pears

6

5

4

3

2

1

1 2 3 4 5

6

A

B

C

D

E

F

G

Constant Cost

One unit of pears costs one unit of apples.

One unit of apples costs one unit of pears.


units of

apples

units of

pears

12

10

8

6

4

2

1 2 3 4 5 6

A

B

C

D

E

F

G

Constant Cost

One unit of pears costs two units of apples.

One unit of apples costs one-half unit of pears.


Let’s Practice!


. According to the diagram at right, what is the

opportunity cost of producing 400 refrigerators?

A. 600 refrigerators

B. 300 automobiles

C. 100 automobiles

D. 200 refrigerators

Automobiles

600

300

400

200

Re

frig

era

tors


According to the diagram at the right, what is the

opportunity cost of producing 200 automobiles?

A. 200 refrigerators

B. 300 automobiles

C. 100 automobiles

D. 400 refrigerators

Automobiles

600

300

400

200

Re

frig

era

tors

ACDC Monsters, Inc.

https://www.youtube.com/watch?v=tW4G5IPpzFY



PRODUCTION POSSIBILITIESYOUR WAY!

PRODUCTION POSSIBILITIESYOUR WAY!

Make sure both of your names are on your Production Possibilities Poster and

stack them up with your worksheet at the front of the class.

We’ll finish them tomorrow!

ECONOMICS

D AY 7 – T U E S D AY, J A N U A RY 2 3 R D

TUESDAY, JANUARY 23RD



– Sit in your assigned seats

– Front table – pick up a Unit One Review Crossword Puzzle and complete it with a

partner!

• FYI –Your Unit One Assignments Cover Page is on the back side – when you turn in

your Unit One Assignments tomorrow just make sure the Assignments Cover Page

side if facing up

CLASS UPDATES

• Remember:

– Tutoring this afternoon!

• Study Session for Unit One Test tomorrow

KEY CONCEPTS TO KNOW

SSEF1Scarcity

Factors of Production

Profit Motive

Opportunity Cost

SSEF2Rational Decision-Making

Marginal Cost & Marginal Benefit

Incentives

Positive Incentives

Negative Incentives

SSEF3Division of Labor

Specialization

Voluntary Exchange

SSEF4Economic Systems

3 Basic Economic Questions

Economic Goals

Allocation Strategies

SSEF5Role of Government in

Economy

Public goods & services

Government regulations

SSEF6Productivity

Inputs and Outputs

Investment driving growth

Production Possibilities Curves/Frontiers

Opportunity Cost

Growth

Efficiency/Inefficiency


SSEF6 Explain how productivity, economic growth, and future standards of living are

influenced by investment in factories, machinery, new technology, and the health,

education, and training of people.

a. Define productivity as the relationship of inputs to outputs.

b. Explain how investment in equipment and technology can lead to economic growth.

c. Explain how investments in human capital (e.g., education, job training, and healthcare) can lead

to a higher standard of living.

d. Analyze, by means of a production possibilities curve: trade-offs, opportunity cost, growth, and

efficiency.

PRODUCTION POSSIBILITIES CURVE QUICK REVIEW

What is it?

a hypothetical representation of the amount of two different goods that can be produced by shifting

resources from the production of one, to the production of the other

What does it show?

used to describe/illustrate a society's choice between two different goods

How can we determine opportunity cost?

OC = what we give up (#2 choice) if we choose something else

Practice – what is Sarah’s OC if she decides to add an 7 hour work shift?

What do all the points on the PPC represent?

All the production possibilities if 100% of current resources are

used efficiently

SO A PPC REFLECTS ‘CURRENT’ RESOURCES…

units of

apples

units of

pears

6

5

4

3

2

1

1 2 3 4 5

6

A

B

C

D

E

F

G

I

Can this society produce at production combination I?

Production Possibilities FrontierSO A PPC REFLECTS ‘CURRENT’ RESOURCES…

No!Not with current

resources

Any points outside the

PPC are not achievable

given current resources

units of

potatoes

units of

apples

6

5

4

3

2

1

1 2 3 4 5

6

A

B

C

D

E

F

G

I

Can this society produce at production combination H?

H

WHAT ABOUT INSIDE THE PPC?

Yes!But they don’t want to.

Any points inside the PPC mean

some resource/s are being wasted

and productivity is lower than it

could be

Events that can expand production possibilities outward…

•A technological advance (remember – a technology is anything that makes life easier)

• railroad cars

• refrigeration

• computers

•An increase in human or natural resources

• population increase

• new discoveries

•Capital investment

• new factories

• new infrastructure

CAN WE MOVE THE PPC?

CAN WE MOVE THE PPC?

Events that can expand production possibilities inward, which means productivity

has gone down…

• Loss of resources

• An economic depression

• Natural disasters

• War

• Disease

units of

capital

goods

units of

consumer

goods

6

5

4

3

2

1

1 2 3 4 5

6

A

B

C

D

E

F

G


One unit of capital goods costs one unit of consumer goods.

One unit of consumer goods costs one unit of capital goods.

DOES IT MATTER WHICH TWO ITEMS ARE ON OUR PPC? It can!

For example:

Capital vs. Consumer

Goods Goods

Think…

Equipment to vs. Consumable

Make things Short Term

Longer Term Items

Investments in capital goods

benefits an economy by helping

them to produce more in the

future

Vs.

Consumer goods provide shorter

term benefits


What BEST explains the shift of the production

possibilities curve from P1 to P2?

A. improvements in agricultural technology

B. inflationary increases in prices

C. higher costs of producing computers

D. higher costs of producing televisions


If a point falls inside the curve, what does that

mean for production?

A. Efficient use of resources

B. Inefficient use of resources

C. New technology

D. Increase in resources

Technologia

• Imagine you are a citizen of Technologia, a country that produces two goods:

– Smartphones

– Tablet computers

• What do these two goods have in common?

– Both digital technology

– Both wireless

– Both have touch screens

Coltan• Coltan is a heat-resistant ore that can

hold a strong electrical charge and is

used in making the capacitors needed

to produce touch screens for both

smartphones and tablet computers.

• Coltan is rare. Almost all the deposits

are found in African countries such as

the Democratic Republic of Congo.

– Source: University of Waterloo Earth Sciences

Museum (http://www.uwaterloo.ca/earth-sciences-

museum)

Technologia’s PPF

• Simulation of smartphone/tablet production

• Five students per team; each person can handle only one card at a time.

– Pull card from “coltan” box.

– Turn card to appropriate side.

– Pass to next person.

– Place in box with appropriate label.

– Repeat until coltan runs out.

Technologia’s PPF Simulation


First person

pulls a card and

turns it to

“Tablet”


Passes the

card down

the line …

TA B L E 1 . 1 : S m a r t p h o n e a n d Ta b l e t C o m p u t e r P r o d u c t i o n P o s s i b i l i t i e s

Round

(point)

Number of

smartphones

Number of tablet

computers

1 (A)

2 (B)

3 (C)

4 (D)

5 (E)

6 (F)

Technologia’s PPF

Tablets

Sm

art

phones

0

5

10

15

20

25

30

0 5 10 15 20 25 30

Technologia’s PPF

• Increase in the

amount of coltan

available for

production

• PPF shifts “out,” away

from the origin

0

5

10

15

20

25

30

0 5 10 15 20 25 30

Sm

art

phones

Tablets

Technologia’s PPF

• Increase in

productivity for

smartphones

• One unit of coltan

can produce two

smartphones

• PPF has shifted

outward, away from

origin0

10

20

30

40

50

60

0 10 20 30 40 50 60

Sm

art

phones

Tablets

ECONOMICS


SSEF5 Describe the roles of government in the United States economy.

a. Explain why government provides public goods and services, redistributes income, protects

property rights, and resolves market failures.

b. Explain the effects on consumers and producers caused by government regulation and

deregulation.

OVERVIEW

• Government has an active role in establishing a framework or rules of the game

in economic life.

• In the United States, this activity involves:

– Preserving and fostering competition

– Providing information and services to enable the market to work better

– Providing certain public goods

– Offering some economic security and income redistribution to individuals

– Assuring a sound monetary system

– Promoting overall economic stability and growth

– Providing military protection

OVERVIEW• Markets perform well in providing most goods and services of everyday life: groceries, restaurant

meals, clothing, movies and cars.

• Nevertheless, there is a role for government in areas where markets fail or are inefficient.

• Some roles of government include protecting the environment, helping the poor and providing

national defense.

• Governments also provide public goods.

– Roads, parks, police, fire departments, etc.

Political opinions differ about how extensive the role of government should be in managing the

economy.

• The paradox of good government is that it must be strong enough to perform its appropriate roles,

but weak enough that it does not intervene excessively in people's lives.

• Although there is a role for government, we cannot assume that it will perform that role well.

• There are and have been policies that hurt the poor, harm the environment and protect monopolies.

PUBLIC GOODS AND SERVICES

• Most goods and services produced in the

marketplace are private goods and

services.

• This kind of good or service is purchased

by a consumer who desires it and can

afford it, and then consumed only by that

individual or anyone he or she gives it to.

• But some goods and services must be produced

by the public sector or government.

• Public goods and services are paid for through tax

dollars and are available to everyone, even those

who do not pay taxes.

• That means taxpayers have an incentive to use

public goods, and try to get more of them

produced, while shirting tax burdens to others.

• This is known as “free riding.”

PRIVATE GOODS AND SERVICES PUBLIC GOODS AND SERVICES

PROPERTY RIGHTS

• Property rights refer to the legal ownership of resources, which include the right to own, use

and sell them.

• Property rights are essential to the transactions in a market economy, and one of the essential

roles of government in a market-oriented economy is to protect property rights.

– When goods, including everything from cars to groceries, are bought and sold, a property right is

transferred from one party to the other.

– Your ownership of your own labor, that is, your property rights in your own labor, is what gives you

the right to be paid for your work.

• Without property rights and ownership, firms would lack any reason to build factories,

produce and innovate, because they wouldn't be able to keep what they made or earned.

• Similarly, people and firms would have a greatly reduced incentive to save or invest, because

they wouldn't be confident of receiving the future value from doing so.

MARKET FAILURES

• A market succeeds when it brings together a willing buyer and willing seller to make a mutually

beneficial transaction in a way that satisfies the parties involved.

• However, there are certain well-recognized conditions under which market failure occurs; this

means either that a market transaction affects third parties not involved in the transaction or

that a market has difficulty in providing certain kinds of products.

MARKET FAILURESHere are some examples of market failure.

• First, externalities are situations in which a market transaction affects a third party who is not

part of the transaction.

– A classic example is pollution, where people who do not purchase the good whose production

created the pollution must nevertheless face polluted air or water.

• A second market failure is one in which the private market is unable to provide the good or

service.

– Two examples of this are national defense and police protection.

– It is very difficult for the private market to charge individuals for these services.

– This means that this role falls to the Government.

• Also, it should be emphasized that the prices that emerge from market exchanges provide

buyers and sellers with far more information relevant to their decisions than would otherwise

be available.

EX AMPLES OF GOVERNMENT REGUL ATION AND DEREGUL ATION AND THEIR EFFECTS ON CONSUMERS AND PRODUCERS

• Is there too much government regulation or too little?

• Who answers that question, and on what basis?

• Many critics have cited the total cost of government regulation and claimed that there is too

much regulation.

• The U.S. Office of Management and Budget recently provided a report to Congress on the

overall costs and benefits of federal regulations suggesting that the critics have failed to

accurately consider all of the benefits resulting from regulation.

• The report goes on to emphasize the importance of applying cost-benefit analysis when

making changes in regulatory policy – in other words comparing the expected costs of a new

policy or a change in an existing policy to the expected benefits.

ECONOMIC FUNCTIONS OF GOVERNMENT

• SSEF5 The student will describe the roles of government in a market economy.

a. Explain why government provides public goods and services, redistributes income, protects

property rights, and resolves market failures.

b. Give examples of government regulation and deregulation and their effects on consumers

and producers.

WOULD YOU…?

• If you have answered no to

these questions, then you

understand why we need

government interaction in the

economy.

• If you answered

yes…well…congrats! You’re a

great human being.

• Pay for some other child’s

school?

• Pay for somebody else’s bus ride?

• Pay to clean a restroom at a

park?

• Pay to build a new road outside

of your house?

GOVERNMENT’S ROLE

1) Provide a Legal System

2) Maintain Competition

3) Public Goods and Services

4) Redistribute Income

5) Correct Market Failures

6) Stabilize the Economy

PROVIDE A LEGAL SYSTEM

• Make and enforce laws to

protect private property

rights

• Examples:

–courts, monetary

system

MAINTAIN COMPETITION

• Regulates monopolies

• Examples

–Anti-trust laws

PUBLIC GOODS AND SERVICES

• Uses tax dollars to provide

goods and services that private

individuals wouldn’t provide

• Benefits everyone

• Examples:

– Parks, national defense,

schools

REDISTRIBUTE INCOME• Taxing large income groups to provide for those in need

• Examples: social security, Medicare, Medicaid

RESOLVE MARKET FAILURES

• Corrects externalities(unintended side

effects or reactions to an action)

• Positive externality- unintended

benefit

• Negative externality- unintended

cost

• Examples:

– Environmental pollution, subsidies,

education

STABILIZE THE ECONOMY

• Reduces unemployment and

inflation and promotes

economic growth

• Examples

– Government budgets,

monetary supply

ECONOMICS

W E D N E S D AY, J A N U A RY 2 4 T H

WEDNESDAY, JANUARY 24TH


• As you come in please,

– Sit in your alphabetical testing seats

– Pull out your Unit One assignments and turn them (on the front table) with

your Assignments Cover Page on top

CLASS UPDATES

• Advisement starts today!

LET’S KAHOOT IT!

• Pull out your smart phone and go to your web browser.

• Enter our session code and join our review

• Remember your Kahoot name needs to include:

– Your first name or your last name

– Keep it clean or you’ll get deleted!

• Prizes for the winners!

NOW…QUICKLY AND CALMLY…

• Pack up your things

• Power down all electronics and put them in your bookbag.

• Then, put your bookbag/purse at the front of the room.

• As you come up to the front of the room, take a laptop back to your seat

OUR UNIT ONE TEST

• We’ll be taking our test with the laptops today

TIME FOR OUR FIRST UNIT TEST!

• Remember our ‘Test Mode’ until the last test is turned in:

– No electronics

– No talking

– No squawking (no noises or disruptions)

– No walking (raise your hand and I’ll come to you)

– No gawking (eyes on your own paper, keep your answer sheet covered)

economics€¦ · unit one fundamentals of economics you can complete your study guide as we...

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