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Economic Decision Making Part B

Economic Decision Making Part B. Ms. Ramos Alta Loma High School. What do we give up when we make a choice?. Ms. Ramos. Maximizing utility: What we want when we choose. Utility: satisfaction from a good, service, or action--- also may be that it improves your life Vaccination Studying.

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Economic Decision Making Part B

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  1. Economic Decision Making Part B Ms. RamosAlta Loma High School

  2. What do we give up when we make a choice? Ms. Ramos

  3. Maximizing utility: What we want when we choose • Utility: satisfaction from a good, service, or action--- also may be that it improves your life • Vaccination • Studying http://library.thinkquest.org/08aug/00436/prevention.html http://library.ucf.edu/Administration/LibraryDevelopment/ENewsletter/Volume3/E-mailIssue08-07.aspx http://www.istockphoto.com/stock-illustration-8048785-silhouette-couples-dresses-up-party-dress-formal.php Ms. Ramos

  4. Which show to watch? • Which college to go to? http://www.cucirca.com/2008/04/09/watch-family-guy-online/ http://www.myspace.com/hiphopjunkieoo http://bandbent.wordpress.com/2009/12/10/guest-blog-mtvs-jersey-shore/ http://www.degreedriven.com/California-colleges/Rancho-Cucamonga/Chaffey-College-WHDDT44LXT.html http://www.workforceexchange.net/Resources/Discounts/Education/tabid/1220/Default.aspx http://gawker.com/5265355/harvard-killer-captured http://www.sportslogos.net/logo.php?id=2671 Ms. Ramos

  5. Tradeoffs: what we give up when we choose • Business • Build trucks or cars • Make trucks, tradeoff: % car market • Society • Guns vs. butter • Military or civilian goods/programs • Personal Ms. Ramos

  6. Opp Cost: The best thing we give up to get what we want • Decision matrix Ms. Ramos

  7. Ms. Ramos

  8. Making “How Much” decisions at the margin • Marginal utility: extra satisfaction from consumption/action • Negative utility: lack of pleasure from consumption/action • Law of diminishing marginal utility Ms. Ramos

  9. http://ice-cream-franchise.trendtodays.info/2010/06/25/the-exercise-and-the-law-of-diminishing-marginal-utility/http://ice-cream-franchise.trendtodays.info/2010/06/25/the-exercise-and-the-law-of-diminishing-marginal-utility/ http://www.greenwaysound.com/forsale3.htm Ms. Ramos

  10. How can we measure what we gain and lose when making choices? Ms. Ramos

  11. Measuring tradeoffs using the production possibilities frontier http://www.netmba.com/econ/micro/production/possibility/ Ms. Ramos

  12. Measuring Opportunity Costs using the PPF http://www.netmba.com/econ/micro/production/possibility/ Ms. Ramos

  13. What does the curve illustrate? Increasing costs http://www.netmba.com/econ/micro/production/possibility/ Ms. Ramos

  14. Measuring economics efficiency using the PPF http://www.netmba.com/econ/micro/production/possibility/ Ms. Ramos

  15. Measuring economics efficiency using the PPF unattainable Attainable, but inefficient http://www.netmba.com/econ/micro/production/possibility/ Ms. Ramos

  16. Reflecting economic change using the PPF Change in productivity http://www.netmba.com/econ/micro/production/possibility/ Ms. Ramos

  17. Shift out means what? Increase-growing economy Ms. Ramos http://www.investopedia.com/university/economics/economics2.asp

  18. Remember: • Shift to the right- increase/growing economy • Shift to the left- decrease/shrinking economy • Pt w/in curve= inefficiency • Pt outside curve= unattainable Ms. Ramos

  19. http://wps.prenhall.com/bp_case_econ_8/52/13546/3467867.cw/index.htmlhttp://wps.prenhall.com/bp_case_econ_8/52/13546/3467867.cw/index.html Ms. Ramos Ms. Ramos

  20. STUDY!!! STUDY!!! STUDY!!! • The unit exam will have the following: • Fill in vocabulary • 10-15 objective (multiple choice & graphs) • 2 short answer prompts- you will be given the two & NOT have a choice this exam Ms. Ramos

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