AFM

Economics 1. Display knowledge of the concept of supply and demand 2. Distinguish between consumer wants and needs 3. Explain the concept of opportunity cost 4. Describe the concept of global opportunities related to goods and services 5. Define characteristics of economies related to government involvement

Globalization and Fashion Globalization – the increasing integration of the world economy. countries no longer limited by their own borders. technological advances – has helped improved worldwide communication systems, such as the internet.

Global Competition Globalization has created increased competition between countries in the manufacturing sector of fashion. labor is a major component of cost production. countries with lower wages have an advantage over countries with higher wages.

International Fashions Technology has increased communication around the world. Many companies place their orders over the internet. Example: A garment in a boutique on Rodeo Drive in Beverly Hills 1. Produced in China with fabric from India and buttons from Bali 2. Designed by a designer in France 3. Modeled on the runways in Milan, Italy, and Paris, France. 4. Purchased by a customer in New York City to wear at a trendy party.

Supply and Demand supply - the quantity of a product offered for sale at all possible prices. demand – the consumer’s willingness and ability to buy and/or use products. surplus – supply exceeds demand shortage - demand exceeds supply equilibrium – supply equals demand

The Law of Demand States: if all other factors remain equal, the higher the price of a good, the less people will demand that good. How much are consumers willing to pay?

The Law of Supply Demonstrates the quantities that will be sold at a certain price. The higher the price, the higher the quantity supplied. Producers supply more at a higher price because selling a higher quantity at a higher price increases revenue.

Opportunity Cost the benefits you could have received by taking an alternative action. Example: The opportunity cost of going to college is the money you would have earned if you worked instead. On the one hand, you lose four years of salary while getting your degree; on the other hand, you hope to earn more during your career, thanks to your education, to offset the lost wages.

Give an example of opportunity cost ??????????????????????????????????????????????????????

Wants vs. Needs What do consumers want? What do consumers need? Difference? Examples? ml