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FOUR KEY ELEMENTS Of ECONOMICS.

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Presentation on theme: "FOUR KEY ELEMENTS Of ECONOMICS."— Presentation transcript:

1 FOUR KEY ELEMENTS Of ECONOMICS

2 Person who studies all that goes on within the functionality of our economic systems and choices
Concerned with how the goods and services are produced and distributed ECONOMISTS

3 ECONOMICS A social science
Observes the behavior of people as they deal with the basic issue of limited resources and unlimited wants The study of human effort to satisfy seemingly unlimited and competing wants through the careful use of relatively scarce resources Studies the decisions that people (individuals) make about using a variety of resources ECONOMICS

4 Involves the effects of economic forces upon the individual parts of the economy
Businesses Households Individual Microeconomics

5 Involves the impact of change on the economy as a whole rather than on an individual part
Unemployment Inflation GDP Money Supply Business Cycle Macroeconomics

6 The Four Key Elements Economics Analyze Explanation Description
Predictions Economics

7 Analyze Scrutinize all aspects of economic activities
Discover why things work How things happen Why do some people earn higher incomes How do taxes affect people’s desire to work and save Recommended Family size Analyze

8 Explanation Communicate newly acquired knowledge to others
Really answer: the HOW and WHY How people are spending less Why or why not an economic measure is performing in the expected manner Explanation

9 HOW IS IT WORKING

10 If there is a common understanding of the way our economy works, some economic problems will be easier to fix

11 Economics is a study of both what is happening and what tends to happen, it can forecast what may happen in the future, including the most likely effects of different actions Predictions

12 Predictions

13 The social science concerned with the efficient use of limited/scarce resources to achieve maximum satisfaction of human economic wants ECONOMICS

14 In other words the study of scarcity and choice
In other words the study of scarcity and choice. Every economic issue involves, at its most basic level, individual choice—decisions by individuals about what to do and what not to do. ECONOMICS


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