Week 1- (8/8-8/12) Flashcards
What is Economics?
- study of producing and consuming goods and services
- study of producers and consumers
- study of choices-> How are we going choose?
- How things work together? -> How we make use of scarce resources?
What are goods?
Tangible items
What are services?
- an intangible item
- tasks that are completed by a company/individual for payment
What is a producer?
the provider of goods and services
What is a consumer?
the user of goods and services
What is scarcity?
It’s the condition that results from society not having enough resources to produce all things people want or need
How does scarcity affect economics?
- it forces people to make choices on what to produce and consume
- you have to prioritize things
Who has to make choices about scarce resources?
- individuals
- governments
- business and industries
What are the consequences of economic choices?
- choices can create benefits
- > every choice made, an opportunity must be given up
How can governments regulate the economic choices that producers and consumers can make?
- allows complete freedom to make economic choices
- > free market, free-economy
- creates regulations for producers and consumers
- > mixed-economy (united states)
- strictly regulates the economy
- > command-economy (north and south korea)
How do your economic choices influence your life?
- choices determine how you divide your time between activities
- > how you choose to spend, save, or invest your money
How does economics impact how you plan your future?
- what choices will you make to achieve your goals?
- how will you balance work and leisure?
- how will you spend and save money you earn?
What is an economics?
- a person who studies how people satisfy seemingly unlimited and competing wants with the careful use of scarce resources
What do economics do?
- conducts research
- collecting and analyzing data
- monitoring economic trends
- developing forecasts on economic issues like energy costs, inflation, interest rates, exchange rates, business cycles, taxes, and employment levels
Who do Economics work for?
- college
- corporations
- government agencies
What are the qualifications for becoming an economics?
- Bachelor’s Degree: for entry-level job, graduate training is required for most economics in the private sector
- Degree should focus on economics, statistics, accounting or calculus
What is opportunity cost?
- What is given up in order to get something else
- It is the next best alternative use of money, time or resources
ex: should I do homework or read on my phone?
- my phone is charging, so I did homework.
Why do we study opportunity cost?
- to make sure that producers and consumers are aware that choices have consequences
What is the production possibilities frontier?
- a diagram that shows how goods or services can be combined in different ways in an economy that is using all of its resources.
Strategies for Evaluating Economic Choices
PERFORMING A COST-BENEFIT ANALYSIS
- Problem solving strategy that involves comparing the cost of an action to the benefits received (there will be consequences)
- The outcome will determine whether the project is a good idea financially of if another project should be pursued.
BUILDING SIMPLE MODELS
- involved reducing complex situations into their most basic elements using a flow chart or diagram.
- can be effective, but they can oversimplify a situation
*models are only as good as the assumptions that are made to create them.
TAKE SMALL, INCREMENTAL STEPS
- individuals or countries do not need to jump into economical decisions with an all or nothing approach
- small amounts, can be invested and then the costs and gains can be analyzed before additional investments are made.
