Exploring the World of Business and Economics

Save this PDF as:
Size: px
Start display at page:

Download "Exploring the World of Business and Economics"

Transcription

1 Chapter One Exploring the World of Business and Economics Copyright Cengage Learning. All rights reserved. 1 1 Learning Objectives 1. Discuss your future in the world of business. 2. Define business and identify potential risks and rewards. 3. Define economics and describe two types of economic systems: capitalism and command economy. 4. Identify the ways to measure economic performance. 5. Outline the four types of competition. 6. Summarize the factors that affect the business environment and the challenges that American businesses will encounter in the future. Copyright Cengage Learning. All rights reserved. 1 2

2 Chapter 1 Outline Your Future in the Changing World of Business Why Study Business? Special Note to Students Business: A Definition The Organized Effort of Individuals Satisfying Needs Business Profit Chapter 1 Outline (cont d) Types of Economic Systems Capitalism Capitalism in the United States Command Economies Measuring Economic Performance The Importance of Productivity in the Global Marketplace Important Economic Indicators that Measure a Nation s Economy The Business Cycle

3 Chapter 1 Outline (cont d) Types of Competition Perfect (or Pure) Competition Monopolistic Competition Oligopoly Monopoly American Business Today Early Business Development The Twentieth Century A New Century: 2000 and Beyond The Current Business Environment The Challenges Ahead Your Future in the Changing World of Business Free enterprise What does it take to succeed in business? Copyright Cengage Learning. All rights reserved. 1 6

4 Why Study Business? For help in choosing a career To be a successful employee To start your own business To become a better informed consumer and investor Copyright Cengage Learning. All rights reserved. 1 7 Tips for Studying Business 1. Prepare before you go to class. 2. Read the chapter. 3. Underline or highlight important concepts. 4. Take notes. 5. Apply the concepts. 6. Practice critical thinking. 7. Prepare for exams. Copyright Cengage Learning. All rights reserved. 1 8

5 Business: A Definition The organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society s needs Copyright Cengage Learning. All rights reserved. 1 9 Classification of Businesses Manufacturing businesses Service businesses Marketing intermediaries Copyright Cengage Learning. All rights reserved. 1 10

6 Satisfying Needs People buy goods and services not just to own them, but to satisfy yparticular needs Businesses that understand customer needs, and work to satisfy those needs, are usually successful Copyright Cengage Learning. All rights reserved The Relationship Between Sales Revenue and Profit Profit is what remains after all business expenses have been deducted from sales revenue. A loss (negative profit) results when a firm s expenses are greater than its revenues. Copyright Cengage Learning. All rights reserved. 1 12

7 Business Profit The purposes of profit Stakeholders Copyright Cengage Learning. All rights reserved Economic Systems Economics Microeconomics Macroeconomics Economy Copyright Cengage Learning. All rights reserved. 1 14

8 Economic Systems (cont d) Factors of production Entrepreneur Differences in economic systems Copyright Cengage Learning. All rights reserved Types of Economic Systems Capitalism Capitalism in the United States Copyright Cengage Learning. All rights reserved. 1 16

9 Types of Economies (cont d) Command economies Socialism Communism Copyright Cengage Learning. All rights reserved Measuring Economic Performance Productivity Economic indicators Gross domestic product (GDP) Inflation Copyright Cengage Learning. All rights reserved. 1 18

10 Common Measures Used to Evaluate a Nation s Economic Health Balance of trade Bank credit Corporate profits Copyright Cengage Learning. All rights reserved Common Measures Used to Evaluate a Nation s Economic Health (cont d) Inflation rate National income New housing starts Copyright Cengage Learning. All rights reserved. 1 20

11 Common Measures Used to Evaluate a Nation s Economic Health (cont d) Prime interest rate Productivity rate Unemployment rate Copyright Cengage Learning. All rights reserved The Business Cycle The recurrence of periods of growth and recession in a nation s economic activity Recession Depression Monetary policies i Copyright Cengage Learning. All rights reserved. 1 22

12 The Business Cycle (cont d) Fiscal policy Federal deficit National debt Copyright Cengage Learning. All rights reserved Types of Competition Perfect (or pure) competition Supply: Demand: Market Price (Equilibrium): Copyright Cengage Learning. All rights reserved. 1 24

13 Types of Competition (cont d) Monopolistic competition Oligopoly Monopoly Copyright Cengage Learning. All rights reserved American Business Today Standard of living Early business development Barter system Domestic system Copyright Cengage Learning. All rights reserved. 1 26

14 American Business Today (cont d) Early Business Development (cont d) Factory system Specialization Copyright Cengage Learning. All rights reserved American Business Today (cont d) The Twentieth Century The Late Twentieth Century A New Century: 2000 and Beyond Copyright Cengage Learning. All rights reserved. 1 28

15 The Challenges Ahead How can we encourage Iraq and Afghanistan to establish a democratic and free society and resolve possible conflict with North Korea and other countries throughout the world? How can we create a more stable economy and create new jobs? As a nation, how can we develop a disaster crisis management program that will help people in times of peril? How can we meet the challenges of managing culturally diverse work forces to address the needs of a culturally diverse marketplace? How can we make American manufacturers more productive and more competitive with foreign producers who have lower labor costs? Copyright Cengage Learning. All rights reserved The Challenges Ahead (cont d) How can we preserve the benefits of competition in our American economic system? How can we encourage economic growth and at the same time continue to conserve natural resources and protect our environment? How can we best market American-made products in foreign nations? How can we meet the needs of two-income families, single parents, older Americans, and the less fortunate? Copyright Cengage Learning. All rights reserved. 1 30

16 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.1 Combining Resources 1 Human resources Material resources Combining Resources Informational resources BUSINESS Financial resources 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 1 3/6/09 6:23:42 PM

17 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.2 The Relationship Between Sales Revenue and Profit 2 The Relationship Between Sales Revenue and Profit Sales revenue Expenses Profit 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 2 3/6/09 6:23:43 PM

18 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.3 Basic Assumptions for Adam Smith s Laissez-Faire Capitalism 3 Laissez-faire capitalism Right to create wealth Right to own private property and resources Right to economic freedom and freedom to compete Right to limited government intervention 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 3 3/6/09 6:23:43 PM

19 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.4 The Circular Flow in Our Mixed Economy 4 The Circular Flow in Our Mixed Economy N atural resources Labor Incom e Capital Resource markets Govt. spending Resources N atural W ages resources Labor Rent Interest Capital Households Tax es Service Governments Tax es Service Businesses G oods Consum er Serv ices sp ending Govt. spending Products Product markets Sales rev enue G oods Serv ices 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 4 3/6/09 6:23:44 PM

20 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.5 GDP in Current Dollars and in Inflation-Adjusted Dollars 5 Year Trillions of dollars 5 4 GDP in current dollars Real GDP in 2000 dollars GDP in Current Dollars and in Inflation- Adjusted Dollars Source: U.S. Bureau of Economic Analysis website at accessed September 14, Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 5 3/6/09 6:23:44 PM

21 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.6 Supply Curve and Demand Curve 6 Quantity in millions of bushels Supply curve 6 Price per unit Market price 7 11 Demand curve 12 $13 Supply Curve and Demand Curve Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 6 3/6/09 6:23:44 PM

22 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.A Chapter Outline 7 Chapter 1 Outline Exploring the World of Business and Economics Your Future in the Changing World of Business Why Study Business? Special Note to Students Business: A Definition The Organized Effort of Individuals Satisfying Needs Business Profit Types of Economic Systems Capitalism Capitalism in the United States Command Economies Measuring Economic Performance The Importance of Productivity in the Global Marketplace Important Economic Indicators that Measure a Nation s Economy The Business Cycle Types of Competition Perfect (or Pure) Competition Monopolistic Competition Oligopoly Monopoly American Business Today Early Business Development The Twentieth Century A New Century: 2000 and Beyond The Current Business Environment The Challenges Ahead 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 7 3/6/09 6:23:45 PM

23 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.B Class Exercise Class Exercise Choose a product that would be sold in each of the four types of competitive situations described in your text. Also, list the name of a specific firm in your area that would sell the product. 8 Competitive Situation Product Specific Firm 1. Perfect competition 2. Monopolistic competition 3. Oligopoly 4. Monopoly 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 8 3/6/09 6:23:45 PM

24 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.C Debate Issue 9 Debate Issue Should there be less government involvement in the United States economic system? YES NO Today, there are too many government controls that inhibit business owners. The added costs of adhering to government regulations are passed on to consumers in the form of higher prices. There is no need for all the government rules and regulations because most business owners are socially responsible. Without adequate government controls, business would take advantage of consumers. While government rules and regulations cost money, the added safety and protection are well worth the money. While the majority of business owners may be socially responsible, there are some that need the encouragement provided by government regulations Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 9 3/6/09 6:23:45 PM

25 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.D Chapter Quiz 10 Chapter Quiz 1. General Motors and Toyota are both examples of a. marketing intermediaries. b. manufacturers. c. wholesalers. d. international agents. e. service businesses. 2. What remains after all business expenses have been deducted from sales revenues is referred to as a. cash. b. excess return. c. profit. d. gross return. e. operating revenue. 3. is an economic system in which individuals own and operate the majority of businesses that provide goods and services. a. Bureaucratic economy b. Command economy c. Communism d. Capitalism e. Socialism 4. The total dollar value of all goods and services produced by all people within the boundaries of a country during a one-year period is called a. gross manufacturing output. b. gross domestic product. c. real gross national product. d. economic product. e. national production report. 5. is a loose subjective measure of how well off an individual or society is. a. Standard of living b. Consumer price index c. Personal economic index d. Individual consumption standard e. Employee producer index 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 10 3/6/09 6:23:45 PM

26 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.E Why Study Business? 11 Why Study Business? Most people take our American business system for granted. Yet there are at least four reasons why you should study business: 1. You can choose a rewarding career. 2. You can be a better employee. 3. You can start your own business. 4. You can become a more informed consumer and investor Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 11 3/6/09 6:23:45 PM

27 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.F Seven Ways to Use This Text and Its Resources 12 Seven Ways to Use This Text and Its Resources 1. Prepare before you go to class. 2. Read the chapter. 3. Underline or highlight important concepts. 4. Take notes. 5. Apply the concepts. 6. Practice critical thinking. 7. Prepare for exams Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 12 3/6/09 6:23:45 PM

28 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.G Definition of Business 13 BUSINESS The organized effort of individuals to produce and sell, for profit, products and services that satisfy society s needs 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 13 3/6/09 6:23:45 PM

29 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.H A Comparison of Capitalism, Socialism, and Communism A Comparison of Capitalism, Socialism, and Communism 14 CAPITALISM SOCIALISM COMMUNISM Management Competition decides what and how to produce based on projected demand encouraged, supported by laws makes decisions in free market sector none among governmentowned industries Profit a basic right not an incentive in governmentowned industries Government role Ownership of productive resources Capital limited; protects consumers, regulates unfair practices private from shareholders and private financial institutions develops master economic plan government owns key industries; private ownership allowed from citizens through savings and from the state top party members dictate business activities none not an incentive; public recognition more important plans and implements economic activity government owns almost all resources from state revenues through taxes 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 14 3/6/09 6:23:45 PM

30 Pride/Hughes/Kapoor, BUSINESS, 10th edition Figure 1.I Definitions of Productivity, GDP, and Inflation 15 Key Economic Terms PRODUCTIVITY The average level of output per worker per hour GROSS DOMESTIC PRODUCT The total dollar value of all goods and services produced by all people within the boundaries of a country during a one-year period INFLATION A general rise in the level of prices 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3768X_01_ch01_p indd 15 3/6/09 6:23:45 PM

Exploring the World of Business and Economics

Exploring the World of Business and Economics Chapter 1 Exploring the World of Business and Economics 1 Discuss what you must do to be successful in the world of business. 2 Define business and identify potential risks and rewards. 3 Define economics

More information

Total Test Questions: 80 Levels: Grades Units of Credit:.50

Total Test Questions: 80 Levels: Grades Units of Credit:.50 DESCRIPTION This course focuses on the study of economic problems and the methods by which societies solve them. Characteristics of the market economy of the United States and its function in the world

More information

Total Test Questions: 80 Levels: Grades Units of Credit:.50

Total Test Questions: 80 Levels: Grades Units of Credit:.50 DESCRIPTION This course focuses on the study of economic problems and the methods by which societies solve them. Characteristics of the market economy of the United States and its function in the world

More information

Curriculum Standard One: The students will understand common economic terms and concepts and economic reasoning.

Curriculum Standard One: The students will understand common economic terms and concepts and economic reasoning. Curriculum Standard One: The students will understand common economic terms and concepts and economic reasoning. *1. The students will examine the causal relationship between scarcity and the need for

More information

PRINCIPLES OF ECONOMICS IN CONTEXT CONTENTS

PRINCIPLES OF ECONOMICS IN CONTEXT CONTENTS PRINCIPLES OF ECONOMICS IN CONTEXT By Neva Goodwin, Jonathan M. Harris, Julie A. Nelson, Brian Roach, and Mariano Torras CONTENTS PART ONE The Context for Economic Analysis Chapter 0: Economics and Well-Being

More information

GACE Economics Assessment Test at a Glance

GACE Economics Assessment Test at a Glance GACE Economics Assessment Test at a Glance Updated June 2017 See the GACE Economics Assessment Study Companion for practice questions and preparation resources. Assessment Name Economics Grade Level 6

More information

Social Studies Curriculum Guide GRADE 12 ECONOMICS

Social Studies Curriculum Guide GRADE 12 ECONOMICS Social Studies Curriculum Guide GRADE 12 ECONOMICS It is the policy of the Fulton County School System not to discriminate on the basis of race, color, sex, religion, national origin, age, or disability

More information

Grades Prentice Hall. Economics Georgia Performance Standards, Economics. Grades 9-12

Grades Prentice Hall. Economics Georgia Performance Standards, Economics. Grades 9-12 Prentice Hall Economics 2010 Grades 9-12 C O R R E L A T E D T O Georgia Performance Standards, Economics Grades 9-12 FORMAT FOR CORRELATION TO THE GEORGIA PERFORMANCE STANDARDS Subject Area: Economics

More information

CHAPTER 3. Economic Challenges Facing Contemporary Business

CHAPTER 3. Economic Challenges Facing Contemporary Business CHAPTER 3 Economic Challenges Facing Contemporary Business Chapter Summary: Key Concepts Opening Overview Economics Microeconomics Macroeconomics A social science that analyzes the choices people and governments

More information

Field 048: Social Studies Economics Assessment Blueprint

Field 048: Social Studies Economics Assessment Blueprint Field 048: Social Studies Economics Assessment Blueprint Domain I Economic Concepts and Research Skills 0001 Economic Concepts and Systems (Standard 1) 0002 Economic Research Skills (Standard 7) Domain

More information

Foundations Series Economics 2010

Foundations Series Economics 2010 A Correlation of Pearson Foundations Series 2010 To the Minnesota Grades 9-12 Academic Standards in Social Studies A Correlation of Foundations Series:, 2010 Table of Contents 2.... 4 3. Fundamental Concepts...

More information

Economic Systems. Economies and Circular Flow

Economic Systems. Economies and Circular Flow Economies and Circular Flow Every society must answer three questions: The Three Economic Questions 1. What goods and services should be produced? 2. How should these goods and services be produced? 3.

More information

Chapter Six. Learning Objectives

Chapter Six. Learning Objectives Chapter Six Understanding the Management Process reserved. 6 1 Learning Objectives 1. Define what management is. 2. Describe the four basic management functions: planning, organizing, leading and motivating,

More information

CREDIT ½ GRADE 12 PREREQUISITE NONE

CREDIT ½ GRADE 12 PREREQUISITE NONE ECONOMICS CREDIT ½ GRADE 12 PREREQUISITE NONE Students will examine the allocation of scarce resources and the economic reasoning used by government agencies and by people as consumers, producers, savers,

More information

NAME DATE CLASS. In the first column, answer the questions based on what you know before you study. After this lesson, complete the last column.

NAME DATE CLASS. In the first column, answer the questions based on what you know before you study. After this lesson, complete the last column. NAME DATE CLASS Lesson 1: Gross Domestic Product ESSENTIAL QUESTION Why and how do people make economic choices? GUIDING QUESTIONS 1. Why is Gross Domestic Product important to a nation? 2. Why is GDP

More information

Unit 2 Economics. Chapter 3 Political and Economic Analysis Chapter 4 Global Analysis

Unit 2 Economics. Chapter 3 Political and Economic Analysis Chapter 4 Global Analysis Unit 2 Economics Chapter 3 Political and Economic Analysis Chapter 4 Global Analysis Chapter 3 Political and Economic Analysis Section 3.1 What Is an Economy? Section 3.2 Understanding the Economy What

More information

REQUIRED SYLLABUS ITEMS

REQUIRED SYLLABUS ITEMS REQUIRED SYLLABUS ITEMS Course Prefix Course Number Course Title Course/Catalog Description Name of College Course Pre or Co requisites Course Competencies Number of Credits Methods of Assessment Course

More information

AGS Economics Michigan High School Content Expectations for Economics

AGS Economics Michigan High School Content Expectations for Economics AGS 2005 Correlated to Michigan High School Content Expectations for 5910 Rice Creek Pkwy, Suite 1000 Shoreview, MN 55126 Copyright 2007 Pearson Education, Inc. or its affiliate(s). All rights reserved.

More information

Chapter 2: Economic Systems Section 2

Chapter 2: Economic Systems Section 2 Chapter 2: Economic Systems Section 2 Objectives 1. Explain why markets exist. E3, 5, 9 2. Analyze a circular flow model of a free market economy. E6, 3. Describe the self-regulating nature of the marketplace.

More information

Economics 101. Chris Gan July Economics 101 1

Economics 101. Chris Gan July Economics 101 1 Economics 101 Chris Gan July 2010 Economics 101 1 What is Economics A study of charts, tables, statistics and numbers? Study of rational human behavior in pursuit to fulfill needs and wants Problem we

More information

TTUISD - TEKS Tracker

TTUISD - TEKS Tracker uthor Todd McKay TTUISD - TEKS Tracker Evaluator Evaluation Date TEKS Requirement (Secondary) Submission Date / / / / TTUISD: Economics with Emphasis on the Free Enterprise System and its Benefits (ECO

More information

AP Economics Final Exam Krugman2014v1

AP Economics Final Exam Krugman2014v1 AP Economics Final Exam Krugman2014v1 Multiple Choice Identify the choice that best completes the statement or answers the question. Module 1 1. Scarcity in economics means: 2 2. Suppose people in households

More information

Chapter 2: Economic Systems

Chapter 2: Economic Systems 2-1 Summary: Fill in the missing words. Because economic resources are limited, a country must answer three key economic questions. These are: 1)? 2)? 3)? In answering these questions, societies must consider

More information

Economics Challenge Online State Qualification Practice Test. 1. An increase in aggregate demand would tend to result from

Economics Challenge Online State Qualification Practice Test. 1. An increase in aggregate demand would tend to result from 1. An increase in aggregate demand would tend to result from A. an increase in tax rates. B. a decrease in consumer spending. C. a decrease in net export spending. D. an increase in business investment.

More information

Chapter 3 Political and Economic Analysis

Chapter 3 Political and Economic Analysis Graphic Organizer Answer Key Section 3.1 What Is an Economy? Graphic Organizer Answer Directions In this diagram, record similarities and differences among market and command economies. Market Economy

More information

Wallingford Public Schools - HIGH SCHOOL COURSE OUTLINE

Wallingford Public Schools - HIGH SCHOOL COURSE OUTLINE Wallingford Public Schools - HIGH SCHOOL COURSE OUTLINE Course Title: Advanced Placement Economics Course Number: 3552 Department: Social Studies Grade(s): 11-12 Level(s): Advanced Placement Credit: 1

More information

Gross Domestic Product

Gross Domestic Product Question 1: What is GDP? Answer 1: From a macroperspective, the broadest measure of economic activity is gross domestic product (GDP). GDP represents all the goods and services that are produced within

More information

EOCT Test Semester 2 final

EOCT Test Semester 2 final EOCT Test Semester 2 final 1. The best definition of Economics is a. The study of how individuals spend their money b. The study of resources and government c. The study of the allocation of scarce resources

More information

UNIT 1: WHAT IS ECONOMICS?

UNIT 1: WHAT IS ECONOMICS? Advanced Placement AP Macroeconomics AP* Macroeconomics students learn why and how the world economy can change from month to month, how to identify trends in our economy, and how to use those trends to

More information

Specific Learning Goals/Benchmarks and Student Assessment. AP Macroeconomics

Specific Learning Goals/Benchmarks and Student Assessment. AP Macroeconomics Unit Bartram Trail HS Specific Learning Goals/Benchmarks and Student Assessment AP Macroeconomics # Benchmark Assessment 1 1 1 2 1 3 1 4 2 5 2 6 3 7 3 8 3 9 3 10 3 11 4 12 4 13 4 14 4 15 4 16 4 17 Define

More information

S11Microeconomics, Exam 3 Answer Key. Instruction:

S11Microeconomics, Exam 3 Answer Key. Instruction: S11Microeconomics, Exam 3 Answer Key Instruction: Exam 3 Student Name: Microeconomics, several versions Early May, 2011 Instructions: I) On your Scantron card you must print three things: 1) Full name

More information

How is it decided which goods and services will be produced, how they will be produced, and who will buy them?

How is it decided which goods and services will be produced, how they will be produced, and who will buy them? Chapter 2: The Market System and Circular Flow Learning objectives: Differentiate between laissez-faire capitalism, the command system and the market system. List the main characteristics of the market

More information

Answering the Three Economic Questions

Answering the Three Economic Questions Answering the Three Economic Questions What key economic questions must every society answer? What basic economic goals do societies have? What types of economic systems exist today? The Three Economic

More information

Unit 55: Business Economics

Unit 55: Business Economics Unit 55: Business Economics Unit code: Y/506/2409 QCF level: 5 Credit value: 15 credits Aim The aim of this unit is to enable learners to understand the behaviour of domestic firms, transnational organisations

More information

Standard CE.11a Economic Concepts

Standard CE.11a Economic Concepts Standard CE.11a Economic Concepts 1. Scarcity is the inability to satisfy all wants at the same time. All resources and goods are limited. This requires that choices be made. 2. Resources are factors of

More information

foundations of economics fourth edition Andrew Gillespie OXFORD UNIVERSITY PRESS

foundations of economics fourth edition Andrew Gillespie OXFORD UNIVERSITY PRESS foundations of economics fourth edition Andrew Gillespie OXFORD UNIVERSITY PRESS Detailed contents Preface How to use this book About the Online Resource Centre Guided tour of Dashboard Acknowledgements

More information

The Economic Problem: Scarcity and Choice

The Economic Problem: Scarcity and Choice Chapter 2 The Economic Problem: Prepared by: Fernando & Yvonn Quijano 2007 Prentice Hall Business Publishing Principles of Economics 8e by Case and Fair The Economic Problem: 2 Chapter Outline Scarcity,

More information

2017/2018 Student Competency Record Economics and Personal Finance weeks

2017/2018 Student Competency Record Economics and Personal Finance weeks 2017/2018 Student Competency Record Economics and Personal Finance 6120-36 weeks Student School Year School Teacher Signature Traditional letter or numerical grades do not provide adequate documentation

More information

Contemporary s Economics McGraw Hill Wright Group 2006 Alignment to Arizona Social Studies Standards Strand 5: Economics

Contemporary s Economics McGraw Hill Wright Group 2006 Alignment to Arizona Social Studies Standards Strand 5: Economics Concept 1: Foundations of Economics The foundations of economics are the application of basic economic concepts and decision-making skills. This includes scarcity and the different methods of allocation

More information

GACE. Study Companion Economics Assessment. For the most up-to-date information, visit the ETS GACE website at gace.ets.org.

GACE. Study Companion Economics Assessment. For the most up-to-date information, visit the ETS GACE website at gace.ets.org. GACE Study Companion Economics Assessment For the most up-to-date information, visit the ETS GACE website at gace.ets.org. Last Updated: January 2016 Copyright 2016 by Educational Testing Service. All

More information

CE.11 The student will demonstrate knowledge of how economic decisions are made in the marketplace by

CE.11 The student will demonstrate knowledge of how economic decisions are made in the marketplace by Objectives CE.11 The student will demonstrate knowledge of how economic decisions are made in the marketplace by a) applying the concepts of scarcity, resources, choice, opportunity cost, price, incentives,

More information

Economics. Synopsis. 1. Economic Concepts, Issues and Tools. 2. An Overview of Economics. Sections. Learning Summary. Sections

Economics. Synopsis. 1. Economic Concepts, Issues and Tools. 2. An Overview of Economics. Sections. Learning Summary. Sections Synopsis Economics 1. Economic Concepts, Issues and Tools 1.1 Introduction 1.2 Scarcity and Choice 1.3 Preferences, Resources and Economic Efficiency 1.4 Marginal Analysis and Opportunity Cost 1.5 Different

More information

TENNESSEE PROPOSED SOCIAL STUDIES CURRICULUM FRAMEWORK, ECONOMICS PROCESS STANDARDS:

TENNESSEE PROPOSED SOCIAL STUDIES CURRICULUM FRAMEWORK, ECONOMICS PROCESS STANDARDS: Tennessee Proposed Social Studies Curriculum Framework, Economics (Grades 9-12) PROCESS STANDARDS: COMMUNICATION Communication is the conveying of value judgments, beliefs and emotions through individual

More information

AP ECONOMICS. Student Eligibility: Grades Date Approved: August 24, 2015

AP ECONOMICS. Student Eligibility: Grades Date Approved: August 24, 2015 PUBLIC SCHOOLS OF EDISON TOWNSHIP DIVISION OF CURRICULUM AND INSTRUCTION AP ECONOMICS Length of Course: Elective/Required: School: Full Year Elective High School Student Eligibility: Grades 11-12 Credit

More information

Thinking Like an Economist. Thinking Like an Economist THE ECONOMIST AS A SCIENTIST. Chapter 2. Thinking Like an Economist

Thinking Like an Economist. Thinking Like an Economist THE ECONOMIST AS A SCIENTIST. Chapter 2. Thinking Like an Economist Chapter 2 Thinking Like an Economist Thinking Like an Economist Every field of study has its own terminology Mathematics integrals axioms vector spaces Psychology ego id cognitive dissonance Law promissory

More information

Name Date/Period Economics Final Exam review - Key

Name Date/Period Economics Final Exam review - Key Name Date/Period Economics Final Exam review - Key 1. Explain the difference between shortage and scarcity. Give an example of each. Shortage is temporary, scarcity is permanent Introduction of new gaming

More information

CHAPTER 2: ECONOMIC SYSTEMS how each society answers the three fundamental questions of what, how, and for whom to produce

CHAPTER 2: ECONOMIC SYSTEMS how each society answers the three fundamental questions of what, how, and for whom to produce CHAPTER 2: ECONOMIC SYSTEMS how each society answers the three fundamental questions of what, how, and for whom to produce Note that there are as many real-world economic systems as there are nations,

More information

Chapter 1. Introduction

Chapter 1. Introduction Chapter 1 You must have already been introduced to a study of basic microeconomics. This chapter begins by giving you a simplified account of how macroeconomics differs from the microeconomics that you

More information

Sometimes public means open as opposed to closed a public place, public behavior, published work as opposed to private homes or diaries.

Sometimes public means open as opposed to closed a public place, public behavior, published work as opposed to private homes or diaries. OUTLINE Privatization: Some Theoretical Considerations Much of this material comes from The Meaning of Privatization, by Paul Starr (Yale Law and Policy Review, 1988), but I have added other material and

More information

2.1 Recognize the elements of communication using a sender receiver model. Unit 1, 2, 3, 4

2.1 Recognize the elements of communication using a sender receiver model. Unit 1, 2, 3, 4 California STATE STANDARD OR BENCHMARK: CORRELATES WITH: Business and Finance Knowledge and Performance Anchor Standards 1.0 Academics Analyze and apply appropriate academic standards required for successful

More information

AP Microeconomics Review With Answers

AP Microeconomics Review With Answers AP Microeconomics Review With Answers 1. Firm in Perfect Competition (Long-Run Equilibrium) 2. Monopoly Industry with comparison of price & output of a Perfectly Competitive Industry (which means show

More information

In this chapter, look for the answers to these questions

In this chapter, look for the answers to these questions In this chapter, look for the answers to these questions What are economists two roles? How do they differ? What are models? How do economists use them? What are the elements of the Circular-Flow Diagram?

More information

GLOSSARY OF TERMS ENTREPRENEURSHIP AND BUSINESS INNOVATION

GLOSSARY OF TERMS ENTREPRENEURSHIP AND BUSINESS INNOVATION Accounts Payable - short term debts incurred as the result of day-to-day operations. Accounts Receivable - monies due to your enterprise as the result of day-to-day operations. Accrual Based Accounting

More information

Things people like and desire.

Things people like and desire. 1 Wants 1 Things people like and desire. 2 Needs 2 Things you must have to live. 3 Scarcity 3 When there is not enough for all who want it. 4 Choice 4 To make a decision. 5 Goods 5 Things that can satisfy

More information

AP Microeconomics. Content Skills Learning Targets Assessment Resources & Technology

AP Microeconomics. Content Skills Learning Targets Assessment Resources & Technology St. Michael Albertville High School Teacher: Matthew Rooker AP Microeconomics October 2014 Content Skills Learning Targets Assessment Resources & Technology November 2014 Content Skills Learning Targets

More information

ECON 1100 Global Economics Exam #2 Fall 2010 (Version B) Multiple Choice Questions ( 2. points each):

ECON 1100 Global Economics Exam #2 Fall 2010 (Version B) Multiple Choice Questions ( 2. points each): ECON 11 Global Economics Exam #2 Fall 21 (Version B) 1 Multiple Choice Questions ( 2 2 points each): 1. In a free market economy, households A. sell finished goods and services to firms. B. receive income

More information

Instructions: must Repeat this answer on lines 37, 38 and 39. Questions:

Instructions: must Repeat this answer on lines 37, 38 and 39. Questions: Final Exam Student Name: Microeconomics, several versions Early May, 2011 Instructions: I) On your Scantron card you must print three things: 1) Full name clearly; 2) Day and time of your section (for

More information

Boğaziçi University, Department of Economics Spring 2016 EC 102 PRINCIPLES of MACROECONOMICS MIDTERM I , Tuesday 11:00 Section 06 TYPE A

Boğaziçi University, Department of Economics Spring 2016 EC 102 PRINCIPLES of MACROECONOMICS MIDTERM I , Tuesday 11:00 Section 06 TYPE A NAME: NO: SECTION: Boğaziçi University, Department of Economics Spring 2016 EC 102 PRINCIPLES of MACROECONOMICS MIDTERM I 15.03.2016, Tuesday 11:00 Section 06 TYPE A Do not forget to write your full name,

More information

ECONOMICS CLASS - XII ( )

ECONOMICS CLASS - XII ( ) ECONOMICS CLASS - XII (2017-18) Theory: 80 Marks Project: 20 Marks Units Marks Periods Part A Introductory Microeconomics Introduction 4 8 Consumer's Equilibrium and Demand 13 32 Producer Behaviour and

More information

The principles of HOW PEOPLE MAKE DECISIONS

The principles of HOW PEOPLE MAKE DECISIONS 1 Ten Principles of Economics P R I N C I P L E S O F MICROECONOMICS FOURTH EDITION N. GREGORY MANKIW Premium PowerPoint Slides by Ron Cronovich 2007 update 2008 Thomson South-Western, all rights reserved

More information

Activator Chapter 1. List the problem that each of the following faced:

Activator Chapter 1. List the problem that each of the following faced: Activator Chapter 1 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

More information

Education & Training Plan. Economics Professional Certificate Program with Externship. Economics Professional Certificate Program with Externship

Education & Training Plan. Economics Professional Certificate Program with Externship. Economics Professional Certificate Program with Externship Clemson University - Center for Corporate Learning 1 North Main Street, 7th Floor, Greenville, SC 29601 http://www.clemson.edu/online/ Contact: Juanita Durham 864.656.3984 jdrhm@clemson.edu Education &

More information

MONOPOLY SOLUTIONS TO TEXT PROBLEMS: Quick Quizzes

MONOPOLY SOLUTIONS TO TEXT PROBLEMS: Quick Quizzes 1 MONOPOLY SOLUTIONS TO TEXT PROBLEMS: Quick Quizzes 1. A market might have a monopoly because: (1) a key resource is owned by a single firm; (2) the government gives a single firm the exclusive right

More information

Economics. Stage 6 Syllabus

Economics. Stage 6 Syllabus Economics Stage 6 Syllabus 2009 Original published version updated: April 2006 Official Notice 3 May 2005 (Vol 14 No 2 BOS 20/05) April 2000 Board Bulletin/Official Notices Vol 9 No 2 (BOS 13/00) June

More information

8/31/09. Understanding economic resources and economic systems is essential to lessening economic problems.

8/31/09. Understanding economic resources and economic systems is essential to lessening economic problems. Chapter 2 Economic Resources and Systems pp. 18-33 Back to Table of Contents Introduction to Business, Economic Resources and Systems Slide 2 of 64 Understanding economic resources and economic systems

More information

Economic Systems and Economic Tools

Economic Systems and Economic Tools CHAPTER 2 Economic Systems and Economic Tools 2.1 Economic Questions and Economic Systems 2.2 Production Possibilities Frontier 2.3 Comparative Advantage 1 CHAPTER 2 Consider Economic Systems and Economic

More information

Unit 1: Fundamental Concepts. Types of Economic Systems. Types of Economic Systems

Unit 1: Fundamental Concepts. Types of Economic Systems. Types of Economic Systems Unit 1: Fundamental Concepts 1-2 Economic Systems 1 Ch. 2 Types of Economic Systems An economic system is the way in which a society uses its resources to satisfy its people s unlimited wants. An economic

More information

1 http://www.investopedia.com/ask/answers/110.asp Microeconomics looks closely at the behavior of individual participants in the economy. While it does aggregate the observations it makes and draws general

More information

Marketing. Econonmics Workbook

Marketing. Econonmics Workbook Marketing Econonmics Workbook Name: Hour: Date: 2008 by GUHSD. Developed in 2008 with grant funds made possible by West-MEC and Western Maricopa Tech-Prep Consortium. The information presented in this

More information

3 CHAPTER OUTLINE CASE FAIR OSTER PEARSON. Demand, Supply, and Market Equilibrium. Input Markets and Output Markets: The Circular Flow

3 CHAPTER OUTLINE CASE FAIR OSTER PEARSON. Demand, Supply, and Market Equilibrium. Input Markets and Output Markets: The Circular Flow CASE FAIR OSTER PEARSON PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N Prepared by: Fernando Quijano w/shelly Tefft 2of 68 Demand, Supply, and Market Equilibrium 3 CHAPTER OUTLINE Firms and

More information

ECONOMICS (Code No. 030) ( )

ECONOMICS (Code No. 030) ( ) ECONOMICS (Code No. 030) (2018-19) Rationale Economics is one of the social sciences, which has great influence on every human being. As economic life and the economy go through changes, the need to ground

More information

CASE FAIR OSTER PEARSON 2012 Pearson Education, Inc. Publishing as Prentice Hall

CASE FAIR OSTER PEARSON 2012 Pearson Education, Inc. Publishing as Prentice Hall e PART II I The Market System: Choices Made by Households and Firms e CASE FAIR OSTER PEARSON 2012 Pearson Education, Inc. Publishing as Prentice Hall PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I

More information

24TECO 202 COURSE OUTLINE. Prerequisites: None. Course Description:

24TECO 202 COURSE OUTLINE. Prerequisites: None. Course Description: Lecture 24TECO 202 24TPrinciples of Microeconomics COURSE OUTLINE Revised: Fall 2015 Prerequisites: None Course Description: Introduces the basic concepts of microeconomics. Explores the free market concepts

More information

ADVANCED PLACEMENT MICROECONOMICS COURSE SYLLABUS

ADVANCED PLACEMENT MICROECONOMICS COURSE SYLLABUS ADVANCED PLACEMENT MICROECONOMICS COURSE SYLLABUS Economics is a way of looking at the choices people make regarding their time, money, and talent. Studying economics shows how goods and services are produced,

More information

Chapter 1 What Is Economics?

Chapter 1 What Is Economics? Chapter 1 What Is Economics? CHAPTER INTRODUCTION SECTION 1 Scarcity and the Science Scarcity and the Science of Economics SECTION 2 Concepts Basic Economic SECTION 3 Economic Choices and Economic Choices

More information

Unit One, Day One (pages 6-20, 28) ECONOMICS: The study of how limited productive resources are efficiently allocated in a world of unlimited wants.

Unit One, Day One (pages 6-20, 28) ECONOMICS: The study of how limited productive resources are efficiently allocated in a world of unlimited wants. Unit One, Day One (pages 6-20, 28) ECONOMICS: The study of how limited productive resources are efficiently allocated in a world of unlimited wants. SCARCITY: WANTS EXCEED RESOURCES We want more than we

More information

AS and A Level Business

AS and A Level Business Business and Economics Department AS and Business Exam Board: AQA AS Level 1. What is business? 2. Managers, leadership and decision making 3. Decision making to improve marketing performance 4. Decision

More information

Institute of Actuaries of India

Institute of Actuaries of India Institute of Actuaries of India Subject CT7 Business Economics For 2018 Examinations Aim The aim of the Business Economics subject is to introduce students to the core economic principles and how these

More information

Virtual Enterprise Certification Assessment

Virtual Enterprise Certification Assessment Assessment Blueprint Test Code: 7975 / Version: 01 Copyright 2010. All Rights Reserved. General Assessment Information Blueprint Contents General Assessment Information Written Assessment Information Specific

More information

+ What is Economics? societies use scarce resources to produce valuable commodities and distribute them among different people

+ What is Economics? societies use scarce resources to produce valuable commodities and distribute them among different people ECONOMICS The word economy comes from a Greek word oikonomia for one who manages a household. is the study of how society manages its scarce resources. Traditionally land, labor, and capital resources

More information

BUSINESS MANAGEMENT (230)

BUSINESS MANAGEMENT (230) DESCRIPTION This Business Management course seeks to develop sound management concepts within students, as management plays a role in any future employment opportunity. Students are able to analyze, synthesize,

More information

Chp. 3: Economic Systems

Chp. 3: Economic Systems Chp. 3: Economic Systems Objectives p. 012 EPF.1 student will demonstrate knowledge of basic economic concepts and structures by e) comparing the characteristics of market, command, traditional, and mixed

More information

Tilak Maharashtra Vidyapeeth Pune BBA Syllabus IV Semester Business Economics Part II EXAM 1

Tilak Maharashtra Vidyapeeth Pune BBA Syllabus IV Semester Business Economics Part II EXAM 1 Tilak Maharashtra Vidyapeeth Pune BBA Syllabus IV Semester 71411 Business Economics Part II EXAM 1 1. Price Determination Under Different Market Structure 1.1 Concept of Market 1.2 Classification of Market

More information

What is an Economic System?

What is an Economic System? Economic Systems What is an Economic System? Economic system: how society uses resources to satisfy people s wants Seeks to answer the three economic questions: What to produce? How to produce it? For

More information

Section 1.2 Introduction to Economics

Section 1.2 Introduction to Economics Section 1.2 Introduction to Economics Economics Economics is a science that examines how goods and services are produced, sold, and used All economic resources are limited; needs and wants are unlimited

More information

Economics-Unit 1 Summer Assignment. 2. Why is the idea of scarcity a starting point for thinking economically?

Economics-Unit 1 Summer Assignment. 2. Why is the idea of scarcity a starting point for thinking economically? Name Period Economics-Unit 1 Summer Assignment Answer the following questions from Unit 1 in at least 1-2 complete sentences. Print this document and handwrite your answers in the space provided. There

More information

Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits)

Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits) Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits) Semester 1/2014 ----------------------------------------------------------------------------------------------

More information

ECON 1000 (Spring 2017 Section 08) Exam #1A

ECON 1000 (Spring 2017 Section 08) Exam #1A ECON 1000 (Spring 2017 Section 08) Exam #1A Multiple Choice Questions: (3 points each) 1. I am taking of the exam. A. Version A 2. Capitalism is defined as an economic system in which A. the means of production

More information

Downloaded from

Downloaded from 17. ECONOMICS (Code No. 030) (2017-18) Rationale Economics is one of the social sciences, which has great influence on every human being. As economic life and the economy go through changes, the need to

More information

Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits)

Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits) Lecture Time: Lecture Venue: Instructor: Faculty of Economics, Thammasat University EE 211 Principles of Microeconomics (3 credits) Semester 1/2015 ----------------------------------------------------------------------------------------------

More information

Ten Principles of Economics

Ten Principles of Economics C H A P T E R 1 Ten Principles of Economics Economics P R I N C I P L E S O F N. Gregory Mankiw Premium PowerPoint Slides by Ron Cronovich 2009 South-Western, a part of Cengage Learning, all rights reserved

More information

ECO201: PRINCIPLES OF MICROECONOMICS FIRST MIDTERM EXAMINATION

ECO201: PRINCIPLES OF MICROECONOMICS FIRST MIDTERM EXAMINATION YOUR NAME Row Number ECO201: PRINCIPLES OF MICROECONOMICS FIRST MIDTERM EXAMINATION Prof. Bill Even Novermber 12, 2014 FORM 1 Directions 1. Fill in your scantron with your unique-id and the form number

More information

ECO201: PRINCIPLES OF MICROECONOMICS FIRST MIDTERM EXAMINATION

ECO201: PRINCIPLES OF MICROECONOMICS FIRST MIDTERM EXAMINATION YOUR NAME Row Number ECO201: PRINCIPLES OF MICROECONOMICS FIRST MIDTERM EXAMINATION Prof. Bill Even Novermber 12, 2014 FORM 3 Directions 1. Fill in your scantron with your unique-id and the form number

More information

PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N CASE FAIR OSTER. PEARSON Prepared by: Fernando Quijano w/shelly Tefft

PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N CASE FAIR OSTER. PEARSON Prepared by: Fernando Quijano w/shelly Tefft PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N CASE FAIR OSTER PEARSON Prepared by: Fernando Quijano w/shelly Tefft 2 of 25 PART III MARKET IMPERFECTIONS AND THE ROLE OF GOVERNMENT Monopoly

More information

12 ECONOMICS 3 MARKS MATERIAL LESSON 1 1. State Alfred Marshall s definition of Economics? Alfred Marshall defines; economics as a study of mankind in the ordinary business of Life 2. What is the main

More information

1.3. Levels and Rates of Change Levels: example, wages and income versus Rates: example, inflation and growth Example: Box 1.3

1.3. Levels and Rates of Change Levels: example, wages and income versus Rates: example, inflation and growth Example: Box 1.3 1 Chapter 1 1.1. Scarcity, Choice, Opportunity Cost Definition of Economics: Resources versus Wants Wants: more and better unlimited Versus Needs: essential limited Versus Demand: ability to pay + want

More information

Social Science Department Advanced Placement Macroeconomics Syllabus Course Objective and Overview

Social Science Department Advanced Placement Macroeconomics Syllabus Course Objective and Overview Social Science Department Advanced Placement Macroeconomics Syllabus 2007 2008 Course Objective and Overview This Advanced Placement course is designed to improve and enhance student understanding and

More information

M11/3/ECONO/HP1/ENG/TZ1/XX/M MARKSCHEME. May 2011 ECONOMICS. Higher Level. Paper pages

M11/3/ECONO/HP1/ENG/TZ1/XX/M MARKSCHEME. May 2011 ECONOMICS. Higher Level. Paper pages M11/3/ECONO/HP1/ENG/TZ1/XX/M MARKSCHEME May 2011 ECONOMICS Higher Level Paper 1 17 pages 2 M11/3/ECONO/HP1/ENG/TZ1/XX/M This markscheme is confidential and for the exclusive use of examiners in this examination

More information

1.5 Nov 98 a. Explain the term natural monopolies and why are they considered a danger if left unregulated. [10] b. (not in 2013 syllabus)

1.5 Nov 98 a. Explain the term natural monopolies and why are they considered a danger if left unregulated. [10] b. (not in 2013 syllabus) Higher Level Essays Microeconomics only 1.5 (old syllabus specimen) a. Explain the main features of an oligopolistic market. [10] b. Discuss whether oligopolies work in favor of, or against the interest

More information

PROGRAMME: Interdepartmental Programme of Postgraduate Studies in Business Administration (M.B.A.)

PROGRAMME: Interdepartmental Programme of Postgraduate Studies in Business Administration (M.B.A.) PROGRAMME: Interdepartmental Programme of Postgraduate Studies in Business Administration (M.B.A.) Compulsory Course: Principles of Economic Theory and Policy Semester: 1st Instructors: Velentzas Konstantinos,

More information