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Introduction to Economics

Introduction to Economics. Chapter 18. Quiz 18. ____ is the study of how people satisfy unlimited wants & needs with limited resources. ____ is basic problem of economics. List the 3 basic economic questions : (3-5) 6. Rent is an example of a ___ cost in a business.

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Introduction to Economics

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  1. Introduction to Economics Chapter 18

  2. Quiz 18 • ____ is the study of how people satisfy unlimited wants & needs with limited resources. • ____ is basic problem of economics. List the 3 basic economic questions: (3-5) 6. Rent is an example of a ___ cost in a business. 7. T/F Economic models are always reliable. 8. T/F Some trade-offs have no opportunity costs. 9. T/F All people have their basic needs met. 10. T/F Most teenagers satisfy wants with their money.

  3. What is Economics? • The study of how people satisfy unlimited wants and needs with limited resources. • Why is “decision science” a good name for economics? • Why can’t we have it all???? • Does everyone make choices? • Why? • SCARCITY: Lack of a resource

  4. Goods versus Services • Goods are tangible items sold for a fee EXAMPLES • Services are work performed for a fee EXAMPLES

  5. The 3 Basic Economic Questions • What to produce? (What to make?) • Availability • Profitability • How to produce? (How to make g/s?) • Efficiency • Better, cheaper, faster • For whom to produce? (Who gets g/s?) • Deservability • Affordability

  6. “You can’t always get what you want” • What is a trade-off? Give an example. • What is an opportunity cost? Give the answer from the above example. • How do opportunity costs play out in the real world? • How do budgets affect trade-offs and their resulting opportunity costs? • Do activity, discuss and award prizes.

  7. How to make good decisions? • Cost-Benefit analysis • Do example. Read 19.1 and complete chart and questions.

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