The world is seen through scarcity and choice

Advise government policy

Increase informed citizenship
Unemployment, inflation, growth, taxation,
poverty, trade, regulation, education
Business seeks
Increased profit
More informed decisions
*Not a vocational science; mainly academic*
Principles expressed as tendencies of
typical consumers, workers, or businesses
Foundations based on 2 facts:
1. Societys economic wants (unlimited & insatiable)
2. Economic Resources (scarcity)
4 factors
Land
Labor
Capital
Entrepreneurial
ability

Land: Forests, mineral, oil, water
Capital:
All manufactured
aids used in
production
Tools, machinery,
equipment, factory,
storage,
transportation
Labor: all physical and mental talents of individuals
Entrepreneurial Ability
Takes Initiative, driving force behind production
Strategic business decisions
Innovator
Risk bearer

All resources
experience
different levels
of scarcity
Opportunity costs
What you sacrifice for another item or
service
Fry has one free hour to
practice the holophonor
for an upcoming recital or
work at Planet Express for
$10 per hour or babysit
Nibbler for $15 per hour.
He chooses to practice the
holophonor. What is the
opportunity cost of
practicing the holophonor?
The opportunity cost would be $15 because it would be the most profitable
alternative.
Marginal Analysis
Marginal Benefits vs. Marginal Costs
Example: (MC) Large the engagement ring
(More $) = (MB)Less $ for future)

Impatience leads to spending over saving
Purchase dissatisfaction
Buyer beware!

Freedom of choice
Enables owners to employ or dispose their
property and money as they see fit
Allows workers to enter any line of work
Economic Efficiency
Maximum fulfillment of wants
Economic Security
Provide for those who unable to earn minimal
levels of income (Sick, disabled, aged, laid off)
Growth
Develop a higher standard of living
Price Stability
Inflation and deflation
Full Employment
Jobs for those willing and able to work
The irregular fluctuations in economic activity

All
resources
experienc
e different
levels of
scarcity
Opportunity costs
What you sacrifice for another item or
service
Fry has one free hour to
practice the holophonor
for an upcoming recital or
work at Planet Express for
$10 per hour or babysit
Nibbler for $15 per hour.
He chooses to practice the
holophonor. What is the
opportunity cost of
practicing the holophonor?
The opportunity cost would be $15 because it would be the most profitable
alternative.
Marginal Analysis
Marginal Benefits vs. Marginal Costs
Example: (MC) Large the engagement
ring (More $) = (MB)Less $ for future)

Impatience leads to spending over saving
Purchase dissatisfaction
Buyer beware!

Bias
Better economies avoid biased
Loaded Terminology
Incorporation of emotion to misuse of definitions to
confuse non-economic minded folk
Post Hoc Fallacy
The belief that one event caused result
Example: New coach, better record; better record due to new
coach
1. Syllabus
2. Signature page (must be signed by you
and your parents to get credit for this)
3. Introduction Sheet (your info plus
something interesting about you and the
two questions about the class)
4. Chapter 1 notes
5. Economics is Life Activity
6. Chapter 1 Questions (what you worked on
today)
This is the only item that does not have to be
completed during the notebook check on
Wednesday. You will continue working on this
while I check notebooks.