Economics 83004 www'msu'edumilewsk6

1
Economics 8/30/04 www.msu.edu/milewsk6

• OBJECTIVE Examine the production possibilities
  frontier.
• I. Journal 4 pt. A
• -answer the question to the caption on p.21
• II. Journal 4 pt. B
• -notes on trade-offs, opportunity costs, the
  PPF
• III. Journal 4 pt. C
• -Econ U.S.A (video)
• -episode 1 pt. 2
• NOTICE Chapter 1 Test Thursday

2
Homework

• IV. Homework due Thursday 9/2/04
• 1.) Read Ch1 sec3 p. 19-25
• Answer questions (3-6) p.25
• 2.) Chapter 1 Review
• Chapter 1 Test Thursday

3
Trade-offs Opportunity Costs

• Trade-offs alternate choices
• Opportunity costs the cost of the next best
  alternative use of money, time, or resources when
  one choice is made rather than another.

4
(No Transcript)
5
Alternate choices in Mr. Milewskis Class

• Example I have two passes for the quarter. If
  I dont use them, I get 25 extra credit points.
  If I use one pass I get 10 extra credit points.
• Question What is the opportunity cost of using
  a pass in Mr. Milewskis class?

6
Graphing Choices

• Passes Extra Credit
• Remaining Lost
• 2 0
• 1 15
• 0 25

7
TINSTAAFL

• There is no such thing as a free lunch
• Other terminology
• Inverse relationship as one number goes up, the
  other number goes down
• Direct relationship as one number goes up, so
  does the other number.

8
(No Transcript)
9
(No Transcript)
10
(No Transcript)
11
Econ U.S.A. episode 1 pt.2

• How did the United States increase production of
  both guns and butter during WWII?

12
Economics 8/31/04www.msu.edu/milewsk6

• OBJECTIVE Examine the circular flow of economic
  activity.
• I. Journal 5 pt. A
• -answer the caption question on p.16 define
  human capital.
• II. Journal 5 pt. B
• -notes on value the circular flow
• III. Chapter 1 Review

13
Value, Utility, Wealth

• Paradox of Value some necessities like water
  have little monetary value, whereas some
  non-necessities, like gold, has a much higher
  value.
• Scarcity is not enough to create value. It must
  have utility.
• Utility the capacity to be useful and provide
  satisfaction.

14
Wealth

• So, for something to have value it must be scarce
  and have utility.
• Wealth the accumulation of those products that
  are tangible, scarce, useful, and transferable
  from one person to another.
• A nations wealth are determined by the total
  amount of its peoples skills (Adam Smith) plus
  its natural resources, capital equipment,
  stores, houses, and all other tangible assets.

15
The Circular Flow p.15

• The Market a location or other mechanism that
  allows buyers and sellers to exchange a certain
  economic product.
• Factor Markets where productive resources are
  bought and sold.
• Product Markets where producers sell their
  goods and services to consumers.

16
Division of Labor

• Division of Labor work is arranged so
  individuals do fewer tasks than before.
• Specialization factors of production perform
  tasks more efficiently than others.
• Human Capital the sum of the skills, abilities,
  health, and motivation of the people.

17
Economics 9/1/04www.msu.edu/milewsk6

• OBJECTIVE Review for Chapter 1 Test.
• I. Journal 6 pt. A
• -read Critical Thinking Skill p.26
• -answer questions (1-2) p.26
• II. Journal 6 pt. B
• -questions on Economics and You (film on Ch1)
• III. Chapter 1 Review
• Reminders
• -Due Tomorrow (3-6) p.25 and Ch1 Review
• -No School Friday 9/3/04
• -No School Monday 9/6/04
• Labour Day (Canada)
• Labor Day (U.S.A.)

18
Economics and You (episode 1)

• 1.) What happens to price when supplies are low?
• 2.) Why is Tickle-me Elmo an example of a
  trade-off?
• 3.) What choices did the Pentagon have to make?

19
Economics 9/2/04www.msu.edu/milewsk6

• OBJECTIVE Review for Chapter 1 Test.
• I. Discuss Chapter 1 Review
• II. Mindjogger
• -Video Economics Review
• III. Journal 7
• -questions on film about small businesses
• Reminders
• -Chapter 1 Test Wednesday 9/8/04
• -No School Tomorrow 9/3/04
• -No School Monday 9/6/04
• Labour Day (Canada)
• Labor Day (U.S.A.)

20
Small Business Film Questions

• 1.) Who is the entrepreneur of this short film?
• 2.) What is his business?
• 3.) What game does the entrepreneur suggest be
  played instead of the waiting game?
• 4.) Who is the entrepreneurs competition?
• 5.) What type of business organization do the
  rivals decide to form?