Mason and Jamie's Economics Page
Chapter 1 Econ Summary
What is Economics?
Jamie Ramseyer
Mason EliasMr. Treadway |Period 3
Overview The chapter "What is Economics?" is about scarcity and how there are unlimited wants but limited resources.
Key Terms Want- things people desire to have
Resource- anything used to produce goods or services
Scarcity- condition in which our wants are greater than the resources availible to satisfy those wants
Opportunity cost- the most highly valued opportunity or alternative fortified when a choice is made
Trade-off- a situation in which more of one thing neccesarily means less of something else
Production possibilities frontier- graphic representation of all possible combinations of two goods that an economy can produce
Rationing device- a means for deciding who gets what portion of the availible resources and goods
Economics- the science that studies the choices of people trying to satisfy their unlimited wants in a world of limited resources
Marginal- additional
Incentive- something that encourages or motivates a person to take action
Microeconomics- branch of economics that deals with human behavior and choices as they relate to relatively small units
Macroeconomics- branch of economics that deals with human behavior and choices as they relate to the entire economy
Tangible- able to be felt by touch
Intangible- not able to be felt by touch
Goods- anything that satisfies a person's wants or brings satisfaction
Utility- quality of bringing satisfaction or happiness
Disutility- quality of bringing dissatisfaction or unhappiness
Land- all the natural recourses found in nature
Labor- physical and mental talents that people contribute to the production of goods and services
Capital- produced goods that can be used as recources for further production
Entrepreneurship- the special talent that some people have for searching out and taking advantage of new business opportunities and for developing new products and new ways of doing things
Comprehension/Critical Thinking and Writing 1. There are many ways a production possibilities frontier can illustrate choice and opportunity cost. When you make decisions you are always choosing what and what not to do. A ppf illustrates choice by a person having to choose between how much of one good they want and how much of a different good they want because there are not unlimited resources. A ppf also illustrates opportunity cost by a person choosing to give up a certain amount of one good in order to produce more of another good. All in all, a ppf is a very easy way to see the choices you make and what the opportunity costs are. 2. Before making a decision you must weigh the positives and negatives of that decision. As well as the positives and negatives of a decision you must also know why you are making that decision. In general, a person wants to choose an activity if the benefits outweigh the costs. Most of the time, if the costs are greater, a person will choose to not do something. Incentives play a role in decision making because they encourage someone to take action. For example, most kids have no motivation to do chores. However, if they are offered money to do that chore, he/she would be given an incentive and be motivated to do that specific chore. Overall, if you do not consider positives and negatives of a decision, you might not reach the goal that you were motivated to reach.
Mason EliasMr. Treadway |Period 3
Overview The chapter "What is Economics?" is about scarcity and how there are unlimited wants but limited resources.
Key Terms Want- things people desire to have
Resource- anything used to produce goods or services
Scarcity- condition in which our wants are greater than the resources availible to satisfy those wants
Opportunity cost- the most highly valued opportunity or alternative fortified when a choice is made
Trade-off- a situation in which more of one thing neccesarily means less of something else
Production possibilities frontier- graphic representation of all possible combinations of two goods that an economy can produce
Rationing device- a means for deciding who gets what portion of the availible resources and goods
Economics- the science that studies the choices of people trying to satisfy their unlimited wants in a world of limited resources
Marginal- additional
Incentive- something that encourages or motivates a person to take action
Microeconomics- branch of economics that deals with human behavior and choices as they relate to relatively small units
Macroeconomics- branch of economics that deals with human behavior and choices as they relate to the entire economy
Tangible- able to be felt by touch
Intangible- not able to be felt by touch
Goods- anything that satisfies a person's wants or brings satisfaction
Utility- quality of bringing satisfaction or happiness
Disutility- quality of bringing dissatisfaction or unhappiness
Land- all the natural recourses found in nature
Labor- physical and mental talents that people contribute to the production of goods and services
Capital- produced goods that can be used as recources for further production
Entrepreneurship- the special talent that some people have for searching out and taking advantage of new business opportunities and for developing new products and new ways of doing things
Comprehension/Critical Thinking and Writing 1. There are many ways a production possibilities frontier can illustrate choice and opportunity cost. When you make decisions you are always choosing what and what not to do. A ppf illustrates choice by a person having to choose between how much of one good they want and how much of a different good they want because there are not unlimited resources. A ppf also illustrates opportunity cost by a person choosing to give up a certain amount of one good in order to produce more of another good. All in all, a ppf is a very easy way to see the choices you make and what the opportunity costs are. 2. Before making a decision you must weigh the positives and negatives of that decision. As well as the positives and negatives of a decision you must also know why you are making that decision. In general, a person wants to choose an activity if the benefits outweigh the costs. Most of the time, if the costs are greater, a person will choose to not do something. Incentives play a role in decision making because they encourage someone to take action. For example, most kids have no motivation to do chores. However, if they are offered money to do that chore, he/she would be given an incentive and be motivated to do that specific chore. Overall, if you do not consider positives and negatives of a decision, you might not reach the goal that you were motivated to reach.
