APK WHO IS MORE IMPORTANT Who is more
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APK: WHO IS MORE IMPORTANT? Who is more important producers or consumers? Answer the question with details to support your answer
Why individuals and groups make economic choices? Goal 7. 03
Market Economic Activity -A location that allows buyers and sellers to exchange goods and services The Decision Makers Consumers- People who purchase products Producers- Group of people who create products Government- Group who controls the market Foreign Sector- Other countries we trade with
The Circular Flow of Economics Trade Foreign Sector Profit is made Product Market Products are bought Buys products Businesses Market Government House Market Offers Jobs/Revenue Provides for the market Income is earned Factor Market
Productivity and Economic Growth * When a nation’s total output increases over time the circular flow gets larger The more productive you are the more you profit Productivity Specialization How efficient resources are being used Concentrating on a specific skill Division of Labor Breaking the total task into smaller jobs Makes use of different skills Human Capital The sum of all the skills, ability, and motivation of the people We earn more when we do the things we can do well When companies invest in their workers their productivity tends to increase
Making Economic Decisions Trade-Offs Exchanging one thing for the use of another. Example When you buy a product, you exchange money for the right to own that product rather than something else you could buy for the same price.
Opportunity Cost Definition < What you cannot buy or do when you choose to do or buy one thing rather than another. Next BEST alternative that you had to give up for the choice you made Example - Cleaning the house includes not only the price of cleaning products but also the time you spent cleaning instead of going out
Marginal Benefit • We usually do something because we expect to achieve some benefit. • Marginal benefit is the additional benefit associated with an action.
Car Payment Rent/Mortgage Fixed Cost Expenses that are the same Light Bill Variable Cost Expenses that change with the number of products produced. Water Bill
Add them both up… Fixed Cost + Variable Cost = TOTAL COST (complete cost of producing a product)
