BASIC ECONOMIC CONCEPTS 12.1 Students understand common economic terms and concepts and economic reasoning. BASIC ECONOMIC CONCEPTS

WARM UP: JANUARY 24, 2017 Imagine that you are going into your favorite store. What items are the most expensive? What items are the least expensive? Provide reasons for the price differences.

GOODS: Definition Consumer good Capital good

Services Definition

Consumers

Activity:Copy the chart below and fill in the answers Activity:Copy the chart below and fill in the answers. Use pages 12-13 in your textbooks. Explanation Example 1 Example 2 Goods: Consumer/ Capital Services Consumer

CLOSURE QUESTION Why are goods, services and consumers an important part of the economy?

WARM UP: JANUARY 25, 2017 Why does water which is a necessity have little monetary value and jewelry which is a non- necessity have a higher value?

UTILITY Definition: Capacity to be useful and provide satisfaction People get satisfaction from different things A good or service has utility for some people Diamonds are scarce and have utility Water has utility but is not scarce in most places Water has less value than diamonds

WEALTH Accumulation of tangible products Nation's wealth=Natural resources, factories, highways, clothing ect. People’s skills can restore their possessions if their wealth was taken away If a country loses people, its wealth would deteriorate

WARM UP: JANUARY 26, 2017 How are you dependent on the economy? How is the economy dependent on you?

Free Enterprise: Consumer durable good: Dishwasher, CD Consumer nondurable good: Soap, gas Wealth: Oil reserves, computers Human capital: Education, ideas

The Circular Flow of Economic Activity Market- Location that allows buyers and sellers to exchange a product Factor markets- This is where people earn incomes Entrepreneurs hire labor for wages, acquire land for rent, and borrow money for interest We participate in the factor market when we go to work and sell your labor to an employee

Product Markets -After people receive income from the resources they see, they spend it in the product market -This is where producers sell their goods and services to consumers -Money that people receive from businesses in the factor market returns to business in the product market -Businesses use this money to produce more goods and services -Markets serve the link between individuals and business

CLOSURE QUESTION Explain in your own words the circular flow of economic activity.

ECONOMICS AGENDA: FRIDAY JANUARY 27, 2017 Learning Objective: Understand Productivity and Economic Growth Standard: 12.1 Students understand common economic terms and concepts and economic reasoning. Warm up question Project Presentations Productivity and Economic Growth Closure question ECONOMICS TEST: FRIDAY FEBRUARY 3 UNIT 1

WARM UP: JANUARY 27, 2017 What do you think makes Qatar, Luxembourg, and Singapore the richest countries in the world?

ECONOMICS AGENDA: Monday JANUARY 30, 2017 Learning Objective: Understand Productivity and Economic GrowthStandard: 12.1 Students understand common economic terms and concepts and economic reasoning. Warm up question Project Presentations Productivity and Economic Growth Closure question Homework: Questions 1-8 page 17 ECONOMICS TEST: FRIDAY FEBRUARY 3 UNIT 1

PRODUCTIVITY Definition: A measure of amount of output produced by a given amount of inputs in a period of time Productivity increases when more output can be produced with the same amount of time. It relates to labor Business owners buy the most efficient capital goods 1. How can a factory be more productive?

Division of Labor When work is arranged so that individual workers do fewer tasks than before Workers who do the same thing every day become proficient in what they do 2. How is this an effective way of working?

Specialization When factors of production perform tasks that can be done efficiently Different regions of the country specialize in things they do best 3. Give examples of regions in the nation that specialize in different products?

Investing in Human Capital This is the sum of the skills, abilities, health, and motivation of people Governments can provide education and health care Businesses can invest in training and programs to improve skills and motivation for its workers Individuals can complete high school, go to technical school or college 4. Why is human capital important for a growing economy?

Economic Interdependence We rely on others, and others rely on us, to provide goods and services we consume Events in one part of the country or world can have dramatic impacts elsewhere Examples: Weather conditions, bad crop years

CLOSURE QUESTION Why do most wealthy nations use the specialization of labor system?