18.1, How Economic Systems Work Pgs. 498-502 EF.1. Examine Scarcity and Choice R.H.1 Cite evidence R.H.2 Determine Central Ideas R.H.10 Read and Comprehend Classroom Instruction That Works, Marzano, 2001, pg. 86, Combination Notes

18,1 How Economic Systems Work Name Date Period 18,1 How Economic Systems Work An economic system is how a society organizes the production and consumption of goods and services Economic Choices A well in formed person who understands economics will make rational choices. Needs and Wants Needs are required for survival Food, clothing, shelter Wants, things we would like to have Entertainment, vacations We do not have enough resources to satisfy all our wants and needs

Economics – the study of how we make decisions in a world in which resources are limited Economic questions Where do products come from? Who makes them? How do they get to stores? Who buys them? Why do they buy them? b. Micro economics – Study of economic decision making on the small scale. individuals small business c. Macro economics – Study of economic decision making on the large scale governments Whole industries societies d. Economic Model – a theory which tries to explain human economic behavior

VI. Economic Systems – a countries way of producing the things its people want and need. a. System in the United States 1. Free Enterprise, 2. Capitalism b. Businesses are allowed to compete for profit with a minimum of government interference VII. John H. Johnson a. Owner-Publisher 1) Jet Magazine 2) Ebony Magazine b. African American c. Faced many hurdles d. Example of a successful leader and businessman

VIII. The Problem of Scarcity Scarcity is when we do not have enough resources to produce all the things we would like to have U.S. does not have enough resources to produce what it needs Because of Scarcity we have to make choices among alternatives Rational Consumer ask if they can afford to buy a new car or not IX. What to Produce? One of the choices that society has to make U.S. does not have enough resources to produce what it needs Because of Scarcity we have to make choices among alternatives Rational Consumer ask if they can afford to buy a new car or not

X. How to Produce? One of the choices that society has to make a. A society must choose how to produce b. Businesses like to produce things as cheaply as possible resulting in pollution or waste c. Every producer of a good or service faces the question of “how to produce”. XI. For Whom to Produce to Produce? One of the choices that society has to make A. How will the goods be distributed among its members B. Most goods in the U.S. is distributed through a price system C. Other possible ways 1. majority rule 2. lottery, 3. first come first serve, 4. share equally, 5. military force

18.1 Economic Choices Writing Support Write a persuasive letter to a parent, guardian or teacher explaining that something you want is actually something you really need.

18.1 Economic Choices Writing Connections (CSRQ) What economic choice has Darby or the Fort Smith School District made that affects your life as a student? Explain?

On a sheet of paper write your name, date, and class period in the upper right hand corner. Title the paper in bold letters, “CSRQ”.

CSRQ Complete Sentence Restating the Question Darby Right answer Example What is the name of this school? Darby Wrong answer Right answer The name of this school is Darby Junior High.

CSRQ Describe the last time you wasted your time? What were you doing? Why was your time wasted? What could you have been doing instead?

18.2 Making Economic Decisions, pgs. 503 - 505 Persuasive Writing (CSRQ) Why might a post-high school education be a wise economic choice? Evaluate (CSRQ) What opportunity costs are linked to participation in after-school activities?

18.2,Making Economic Decisions pgs. 503 - 509 Hard work reaps great rewards!! Focus Question Have you ever had a problem trying to choose one thing instead of another? Reading, Combination Note taking Vocabulary Main Ideas Supported by Facts Details Reasons EF.1. Examine Scarcity and Choice R.H.1 Cite evidence R.H.2 Determine Central Ideas R.H.10 Read and Comprehend Classroom Instruction That Works, Marzano, 2001, pg. 86, Combination Notes

18,2 Making Economic Decisions Name Date Period 18,2 Making Economic Decisions I. An economic system is the way a society organizes the production and consumption of goods and services II. Trade Offs Econ decision making requires us to understand all the costs and benefits of a choice. Trade-Off is the choice you face if you decide to do one thing instead of another. A trade off can apply to things other than money Trade off on a large scale may involve a country deciding to spend more money on education instead of defense.

Scarcity, Opportunity Cost & Cost Benefit Analysis Focus Question Evaluate how you can make efficient use of your own resources? Oral and Visual Presentation by Teacher Listen Carefully Look for main ideas Take Notes Turn in notes at end of class Note taking Take copious notes Include Main ideas Content Vocabulary Facts Details Reasons Graphics All work is due at the end of class. Textbook is available for sign out only to those who were absent.

pg. 510 Simple & Compound Interest Interest paid on the principal and any interest that has been earned. Simple Interest Interest paid on only the principal 6%=.06 Read page 510 Answer questions 1 & 2, Define principal

$300 + $18 1 year $318 + $18 2 year $336 + $18 3 year $354 Simple Interest $300 Principal X .06 Interest Rate $18.00 Return (profit) $300 + $18 1 year $318 + $18 2 year $336 + $18 3 year $354 The return on a three year investment of $300 at 6% interest rate is… $54

$300 Principal X .06 Interest Rate $18.00 Return (profit) Compound Interest $300 Principal X .06 Interest Rate $18.00 Return (profit) $318 principal x .06 interest rate $19.08 return + $318.00 $337.08 2 year x .06 $20.22 +$337.08 $357.30 3 year The return on a three year investment of $300 at 6% interest rate is… $57.30

Chapter 18 Visual Summary Focus Question Evaluate how you can improve your chances for economic success? Oral and Visual Presentation Watch and Listen Carefully Take notes All notes are to be turned in at end of class for grading. Your notes will be made available for you to use on the chapter test.