Activator

1. Activator • Freezing Boiling Water Pile-up Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

2. Salt Prices Chicago Salt Demand Time Salt Article Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

3. Activator • During the holiday season of 1996, a children's toy appeared on Good Morning America. The toy, produced by Mattel, had sat on the shelves with very little sales until it appeared on the show. After the toys appearance, its popularity improved and it became the most sought after product of the holiday season. Unfortunately, Mattel did not anticipate the doll’s popularity, only producing 400,000 units, and were not able provide the product in a timely manner at the store level (over 1,000,000 were in demand). Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

4. Elmo was sold for as much as $2500 through a classified ad Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

5. Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

6. Fundamental Economic ConceptsScarcity and the Factors of Production • Scarcity - fundamental problem facing all people; unlimited wants and limited resources to satisfy those wants • The Basic Economic Problem: • We want more than we can have! • Humans' wants and needs are infinite, while the resources needed to satisfy those wants and needs are limited and scarce. Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

7. Scarcity • What makes something scarce? • Something is scarce when it is both limited and desirable • e.g. - Lebron James, oil, time, rest, grass in the winter (north) etc. • Scarcity applies to everyone • Scarcity represents permanent problems that cannot be solved Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

8. Application Question • List three things that you feel are scarce in your personal life, what has caused them to become scarce? Sleep! Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

9. Simulation Questions Scenario: You and your group members represent a small society. You have been given a resource that is in a paper bag. You must figure out how to allocate (distribute) this limited resource amongst your society. • What is the fundamental problem with your scenario? • You have limited resources, brainstorm different ways that you might distribute your resources. What is your group’s decision? Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

10. How to allocate (distribute) scarce resourcesWho gets scarce stuff? Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

11. Scarcity and Specialization $7.25 an hour $65,000 a year $7 Million a year Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

12. What is Economics? • Economics – the study of choices; how individuals and groups seek to satisfy their wants and needs in light of scarcity Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

13. What are the resources necessary to produce? Factors of Production • Factors of Production - resources required to produce goods and services Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

14. Land • Land – natural resources not created by human effort that are used to produce goods and services • The "gifts of nature". • Examples: Forests, fish, oil, gas, cattle, etc... Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

15. Labor • Labor – time and effort devoted to producing goods and services. • “The Workers” • Labor resources are those provided by the body and minds of men and women. • Examples: Cashier at Wal-Mart, teachers, construction workers, etc... Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

16. Capital • 3 Types • Physical Capital – also known as Capital Goods, human made objects used to create other goods and services • Examples: Machines, phones, computers, equipment • Human Capital – skills, abilities, and specialized talents of people • Examples: College, training, technical school, etc. • Financial Capital – money, used by businesses to expand, purchase inventory or pay employees • Examples: money Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

17. Entrepreneurs • Entrepreneurs – business owners who organize the factors of production to bring stuff to the market in order to make profit. • Entrepreneurs are the "risk takers" who begin small business that create jobs. • Hungry Hannah’s – cooks, cashiers, servers, etc. • Coastal Georgia Athletics – choreographer, stunt coach, tumbling coach. Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

18. Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

19. Factors of Production Land Capital Labor Entrepreneur + + + = Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

20. Factors of Production Georgia-Pacific Entrepreneur Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

21. Classify the Factors of Production in the following scenario: • You decide to order a pizza to satisfy your wants. First, you picked up the telephone and gave your order to the owner that entered it into her computer. The information came up on the chief baker’smonitor in the kitchen and he assigned it to one of his cooks. The cook cook used his knowledge of mixing dough out of salt, flour, eggs, and milk. The cook finished mixing dough, washed his hands in the sink, and prepared your pizza using tomato sauce, cheese, and sausage. He then placed the pizza in the oven. Within 10 minutes the pizza was cooked and placed in a cardboard box. The delivery person then grabbed your pizza, jumped in the company car, and delivered it to your door. Land Capital Labor Entrepreneur Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

22. Classify the Factors of Production in the following scenario: Owner _________________________________ Computer _________________________________ Chief baker’s monitor _________________________________ Cooks _________________________________ Knowledge of mixing dough _________________________________ Salt, flour, eggs, and milk _________________________________ Sink _________________________________ Tomato sauce, cheese, and sausage _________________________________ Oven _________________________________ Delivery person _________________________________ Company car _________________________________ Entrepreneur Physical Capital Physical Capital Labor Human Capital Land Physical Capital Land Physical Capital Labor Physical Capital Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

23. Examples of Factors of Production Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

24. Scarcity Videos • Water Scarcity • Water Scarcity Part 2 • Scarcity Video Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

25. Examples of Factors of Production

26. Factors of Production Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

27. Practice Questions Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

28. Practice Questions Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

29. The most advanced economy with updated technologies and skilled workers still cannot have everything that it wants. The fact that people have limited resources to deal with unlimited wants is known as • Comparative advantage • Scarcity • Opportunity cost • Specialization Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

30. The following represent situations in the economy: • Situations • Business is good and firms are actively hiring workers. • Many individuals are starting business. • Employees wages are rising. • Consumer’s are making more money and saving more. • Which of the following above represents the concept of entrepreneurship? • Situation 1 • Situation 2 • Situation 3 • Situation 4 Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources.

31. Needs vs. Wants • Need – a basic requirement for survival • e.g. – food, clothing, education, etc… • Want – not a basic requirement for survival; a means of expressing a need • e.g. – cheeseburger, Abercrombie and Fitch, University of Georgia, etc… OR Learning Target: I can compare and contrast wants and needs and goods and services.

32. Goods Good – physical, tangible(touchable) product • i.e. – Automobiles, Video Games, Cell Phones, CD’s, Tickle Me Elmo, etc… Learning Target: I can compare and contrast wants and needs and goods and services.

33. Services Service – a non-tangible action or activity that is performed for someone else • i.e – Financial Advisor, Stock Broker, Movies, Dentist, Teachers, etc.. Learning Target: I can compare and contrast wants and needs and goods and services.

34. Show 4/5Commercials for following Chart Learning Target: I can define opportunity cost as the next best alternative given up when individuals, businesses and government confront scarcity by making choices. Jean Claude Volvo Nextel Defective Treadmill Michael Jordan Moomba Swagger Wagon

35. Goods and Services Chart Learning Target: I can compare and contrast wants and needs and goods and services.

36. Daily Assignment Chapter 1 Section 1 • Who does scarcity apply to? Explain • List a good and a service that you have purchased in the past month. • What are some things that you have that might be considered wants by other societies? Explain why. • Last year, you were trying to make a decision on what kind of car you wanted your parents to buy you for your birthday. You had two choices: 1) 1984, Honda Accord for $2,000, or 2) 2010 fully stocked Infiniti G37 for $52,000. Which one of these would be considered a want, and which one a need and why? • “Hank” works two jobs, one in the morning and one at night. At his morning job he sells furniture at a furniture store. At his night job he works as a computer technician. Which one of his jobs creates a good and which provides a service? • Microsoft offers all of their employees the opportunity to attend the local university for a higher education, free of charge. What would be the motivation for investing in human capital? • Which factor of production is represented by each of the following? (a) an office building, (b) an assembly line worker, (c) a tree used to make paper, (d) unused soil, (e) Oprah Winfrey Learning Target: I can explain how scarcity is a basic condition that exists when unlimited wants exceed limited productive resources. Learning Target: I can define and provide examples of the factors of production (land, labor, capital and entrepreneurship).

37. Short Answer 2-6

38. Directions: On a 3 column chart, label it as shown below. In the second column, list 3 possible alternatives that you could have made other than your choice to come to school. In the third column, list the alternative that you would have desired the most. Learning Target: I can define opportunity cost as the next best alternative given up when individuals, businesses and government confront scarcity by making choices.

39. Tradeoffs • Trade-off – giving up one thing in order to gain another • “There is no such thing as a free lunch.” (TINSTAAFL) • Who faces tradeoffs? Everyone Learning Target: I can define opportunity cost as the next best alternative given up when individuals, businesses and government confront scarcity by making choices.

40. Opportunity Cost • Opportunity Cost – used by economists to measure the cost of decision-making; the value of the what we give up • Next best alternative use of money, time, or resources Coming to Economics Sleeping (Opportunity Cost) Learning Target: I can define opportunity cost as the next best alternative given up when individuals, businesses and government confront scarcity by making choices.

41. Opportunity Cost Rocky Balboa Apollo Creed

42. Trade-Offs Learning Target: I can define opportunity cost as the next best alternative given up when individuals, businesses and government confront scarcity by making choices. Individuals and Trade-Offs – studying one subject vs. another, watching TV or working out, etc. Business Trade-Offs – producing iPod vs. iPhone Society and Trade-Offs – “guns or butter”, military or consumer goods

43. 2. Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs.

44. Decision-Making Grid or No Yes Yes No No Yes Yes Yes No Yes Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs.

45. Decision-Making Grid or No Yes Yes No No Yes Yes Yes No Yes Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs.

46. Thinking at the Margin 1 2 3 4 5 6 7 8 10 9 8 4 2 0 -2 -10 Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs.

47. Thinking at the Margin 6:15 6:30 6:45 • - - - • Normal wakeup time Gain 15 minutes of sleep Gain additional 15 minutes of sleep • Cost 15 minutes of planning • Cost 15 minutes of planning Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs.

48. Thinking at the Margin $9.00 13.50 13.50 13.50 40 41 42 43 • 40 hours of play • 1 hour playing video games • 1 hour with family • 1 studying economics Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs.

49. Thinking at the Margin • Margin – an increment (small unit), a border/edge • Thinking at the margin – analyzing the costs and benefits of incremental (small) decisions • Marginal Cost – the incremental cost of decision-making. • Marginal Benefit – the incremental benefit of decision-making. • Incentive – motivating factor to make a decision. Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs.

50. Application Learning Target: I can define marginal cost and marginal benefit and that rational decisions occur when the marginal benefits exceed marginal costs. Learning Target: I can define opportunity cost as the next best alternative given up when individuals, businesses and government confront scarcity by making choices.