Economic Essentials #1

What is economics?

Journal

• Describe the current state of the economy. – Would you say it is strong or weak? – What factors make an economy

weak or strong?

Chapter 1 / Section 1 Objectives

1. To describe the relationship between scarcity and choice.

2. To identify productive resources, and list examples.

3. To define goods and services, and list examples.

4. To explain why goods and services are scarce.

Economics

The study of the choices people make to satisfy wants and needs

Economics Is…Economics Is…

•The study of limited The study of limited resources but resources but

unlimited wants, unlimited wants, which forces people which forces people to make a CHOICE!to make a CHOICE!

• Make a list of 5 things you Make a list of 5 things you want!!!want!!!

List 5 things you need to survive.

• NEEDS:

What is the difference What is the difference between a between a

““Need” vs. a “Want”?Need” vs. a “Want”?

ScarcityScarcityThe Economic The Economic

ProblemProblem

SCARCITYSCARCITY

Unlimited Wants

SCARCITYSCARCITY

LimitedResources

Who decides what to make?

• Producers:–Makers of products –How do they decide what to produce?–Incentives: something that motivates –What is the producers main incentive?

• Consumers:

–Those who decide to buy things

–How do they decide what to buy?

–What is the main incentive for consumers?

Which one do you buy?

• 75 cents • $1.25

WHY???

Types of Products • Good

– physical, tangible product– shirt, car, candy bar

• Service – actions or activities – lawyer, movie, hair cut

• Which one do you spend more money on?

National Economies

• The U.S. is “consumer” society. • China is a “producer” society.

How might this affect our economy?

•Copy the bullet points AND question

•Respond to the question. This is your EXIT TICKET.