1. UNIT ONE Fundamental Economic Principles
CHAPTER ONE: INTRO TO ECONOMICS

2. INTRODUCTION TO ECONOMICS
ESSENTIAL QUESTIONS
UNIT ONE – CHAPTER ONE
**MUST KNOW FOR THE QUIZ**
How does the concept of scarcity assign value to world’s resources?
How do the three basic economic questions promote the efficient and wise uses of scarce resources?

3. INTRODUCTION TO ECONOMICS
LEARNING GOALS
UNIT ONE – CHAPTER ONE
Summarize the practical applications of economics as a social science to the business world and American society
Describe the concept of scarcity
Explain the fundamental economic problem
Identify the four factors of production

4. LESSON ONE The Fundamental Economic Problem

5. INTRODUCTION TO ECONOMICS
JOURNAL PROMPT I
What is Economics?
5 – 7 MINUTES

6. INTRODUCTION TO ECONOMICS
What do you know about scarce resources?
How does it effect our economy?

7. INTRODUCTION TO ECONOMICS
~THE FUNDAMENTAL ECONOMIC PROBLEM~
The fundamental economic problem in ALL societies is the concept of scarcity
SCARCITY: the condition that results from society not having enough resources to produce all of the things they would like to have
ECONOMICS is the study of how people try to satisfy seemingly unlimited and competing wants through the careful use of scarce resources

8. INTRODUCTION TO ECONOMICS
~NO SUCH THING AS A FREE LUNCH~
Since resources are limited, everything we do has a cost
Everything comes at a cost – even if it is given away for free
In a free market – producers will always look to maximize their profit, but at what costs?
Herein lies the TRAGEDY OF THE COMMONS

9. INTRODUCTION TO ECONOMICS
~THE TRAGEDY OF THE COMMONS~
IN GROUPS OF FOUR/FIVE, READ THE “TRAGEDY OF THE COMMONS” HANDOUT AND COMPLETE THE TASK.
BE PREPARED TO DISCUSS!
THIS TASK WILL BE YOUR FIRST OFFICIAL GRADE OF THE 3rd MARKING PERIOD!

10. LESSON TWO Essential Economic Questions & Factors of Production

11. INTRODUCTION TO ECONOMICS
JOURNAL PROMPT II
What is the biggest economic problem in this Country?
5 – 7 MINUTES

12. INTRODUCTION TO ECONOMICS
~THE THREE ESSENTIAL ECONOMIC QUESTIONS~
WHAT to produce?
HOW to produce?
FOR WHOM to produce?

13. INTRODUCTION TO ECONOMICS
~THE THREE ESSENTIAL ECONOMIC QUESTIONS~
WHAT to produce?
Society / businesses / governments need to decide how and where to direct its resources
Society cannot have everything it wants, so it must decide what to produce
Who is capable and/or qualified to make this decision?

14. INTRODUCTION TO ECONOMICS
~THE THREE ESSENTIAL ECONOMIC QUESTIONS~
HOW to produce?
How should society / business / government produce?
When does efficiency become more important than creating / supplying jobs?
Who is capable and/or qualified to make this decision?

15. INTRODUCTION TO ECONOMICS
~THE THREE ESSENTIAL ECONOMIC QUESTIONS~
FOR WHOM to produce?
After society / business / government decides WHAT and HOW to produce, it must decide who will receive the things produced?
Who is capable and/or qualified to make this decision?

16. INTRODUCTION TO ECONOMICS
~THE FUNDAMENTAL ECONOMIC PROBLEM~
~THE CONCEPT OF SCARCITY~
UNLIMITED
WANTS
LIMITED
RESOURCES
SCARCITY
CHOICES
WHAT
to produce
HOW
to produce
FOR WHOM
to produce

17. INTRODUCTION TO ECONOMICS
REFLECTION
USE THE STUDENT REFLECTION SCALE TO RATE YOUR COMFORT LEVEL ON THE TOPICS OF SCARCITY AND THE FUNDAMENTAL ECONOMIC PROBLEM.
RESPOND IN YOUR JOURNALS OR
RESPOND PUBLICALLY ON THE WIKI

18. INTRODUCTION TO ECONOMICS
~THE SCOPE OF ECONOMICS~
WHAT DOES ECONOMICS MEASURE?
Economics analyzes how societies satisfy wants through careful use of relatively scarce resources
We study human efforts to satisfy the wants and needs of society
Economics is a social science because it deals with behavioral responses to the FUNDAMENTAL ECONOMIC PROBLEM
In economics, we study four key elements to deal with “THE PROBLEM”:
DESCRIPTION
ANALYSIS
EXPLANATION
PREDICTION

19. INTRODUCTION TO ECONOMICS
~THE SCOPE OF ECONOMICS~
STUDYING AND ANALYZING “THE PROBLEM”
DESCRIPTION: the description of economic activity in question.
GROSS DOMESTIC PRODUCT: the dollar value of all final goods, services, and structures produced within a country’s borders over the course of a year
The GDP “describes” the economic health of a nation, but it does not tells us “how” and “why” it is… what it is

20. INTRODUCTION TO ECONOMICS
~THE SCOPE OF ECONOMICS~
STUDYING AND ANALYZING “THE PROBLEM”
ANALYSIS: economics analyzes the activity it describes
Analysis helps us discover why things work and happen the way that they do (economically speaking)
Critical analysis allows us to deal with problems that need to be solved or improved, such as, resource management

21. INTRODUCTION TO ECONOMICS
~THE SCOPE OF ECONOMICS~
STUDYING AND ANALYZING “THE PROBLEM”
EXPLANATION: after analyzing a problem, we need to understand why and how things work
We need to communicate knowledge, activity, and trends to other
With respect to GDP, explaining why it is … what it is… is the most difficult and time consuming element

22. INTRODUCTION TO ECONOMICS
~THE SCOPE OF ECONOMICS~
STUDYING AND ANALYZING “THE PROBLEM”
PREDICTION: economics is concerned with forecasting future possibilities and expectations
Good economists can predict the likely effects of different actions
Good predictions help the economy because informed citizens are better decision makers
Good economic choices are the responsibility of a free and democratic society