Economics 82404 www'msu'edumilewsk6

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Economics 8/24/04 www.msu.edu/milewsk6

• OBJECTIVE First day of school administrative
  stuff.
• I. Welcome Back ?
• II. Attendance
• III. Distribution of
• -syllabus
• -textbooks
• IV. Homework

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Estrada, Erik 03-224

• New text

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Important Stuff

• Web-site
• www.msu.edu/milewsk6
• Homework Due Friday
• 1.) Book covered
• 2.) Syllabus signed and returned
• 3.) -Read Ch1 sec2 p.12-17
• -Answer questions (3-6) p.17

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Economics 8/25/04www.msu.edu/milewsk6

• OBJECTIVE Examine the fundamental economic
  problem.
• I. Journal 1 pt. A
• -Read The Global Economy p.9
• -Answer questions (1-3) p.9
• II. Journal 1 pt. B
• -notes on the fundamental economic problem
• III. Homework (due Friday)
• 1.) Book covered
• 2.) Syllabus signed and returned
• 3.) -Read Ch1 sec2 p.12-17
• -Answer questions (3-6) p.17

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The Fundamental Economic problem is

• Scarcity - the condition that results from
  society not having enough resources to produce
  all the things people would like to have.
• Economics - the study of how people try to
  satisfy what appears to be seemingly unlimited
  competing wants through the careful use of
  relatively scarce resources.

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Need v. Want

• Need - a basic requirement for survival
  includes food, clothing, and shelter.
• Want - a way of expressing need.

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Scarcity

• Since people have unlimited wants limited
  resources, scarcity leads to choices.
• 1.) What to produce?
• 2.) How to produce?
• 3.) For whom to produce?

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Economics 8/26/04www.msu.edu/milewsk6

• OBJECTIVE Examine the factors of production.
• I. Journal 2 pt. A
• -Read the Business Week Newsclip p.11
• -Answer questions (1-2) p.11
• II. Journal 2 pt. B
• -notes on the factors of production
• III. Journal 2 pt. C
• -Econ U.S.A. (video)
• -episode 1 part I

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Yesterday we left off with 3 questions

• 1.) What to produce?
• 2.) How to produce?
• 3.) For whom to produce?
• REMINDER Homework (due Friday)
• 1.) Book covered
• 2.) Syllabus signed and returned
• 3.) -Read Ch1 sec2 p.12-17
• -Answer questions (3-6) p.17

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The Factors of Production

• LAND the gifts of nature
• LABOR people with all their efforts abilities
• CAPITAL the tools, equipment, machinery, and
  factories used in the production of goods
  services
• ENTREPRENEURS a risk taker in search of profits
  who does something new with existing resources

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Goods Services

• Goods - an item that is economically useful or
  satisfies an economic want
• Services - work that is performed for someone
• Consumer a person who uses goods services

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Econ U.S.A. episode 1

• Please answer the following questions
• 1.) Why were Americans standing in long lines
  for gas during the 1970s?
• 2.) Why did Congress debate the fate of the
  Alaskan Wildlife Refuge?

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Homework Due Tomorrow

• 1.) Book covered
• 2.) Syllabus signed and returned
• 3.) -Read Ch1 sec2 p.12-17
• -Answer questions (3-6) p.17
• Rowing Meeting Today After School

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Economics 8/27/04 www.msu.edu/milewsk6

• OBJECTIVE Examine the categories of goods and
  services.
• I. Journal 3 pt. A
• -Read Profiles in Economics p.18
• -Answer questions (1-2) p. 18
• II. Journal 3 pt. B
• -notes on goods and services

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Types of goods

• Consumer good intended for final use by
  individuals (personal computer, dishwasher)
• Capital good manufactured goods used to produce
  other goods (robot welder, oven in a bakery,
  computer in a H.S.)
• Durable goods a good intended to last 3 years
  or more when used on a regular basis (can be both
  a consumer good or a capital good)
• Nondurable good a good that lasts less than 3
  years (food, notebook, shampoo)

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Goods v. Services

• The difference between goods and services is that
  a good is tangible, services are not.

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Production Possibilities Frontier

• PPF is a diagram that represents various
  combinations of goods and/or services an economy
  can produce when all productive resources are
  fully employed.
• Opportunity Cost the cost of next best
  alternative use of money, time, or resources when
  one choice is made rather than another.
• P.23