Economics
• SOL 3.7
• SOL 3.8
• SOL 3.9
• SOL 3.10
• Exchange
• Barter
To trade one thing for another.
The exchange of goods or service
without money.
Example: I want to trade in my
green disk for a blue one.
Example: I’ll give you my cake for
your ice cream.
Three Kinds of
Money
Cash
Checks
Credit Cards
Needs vs. Wants
• Needs – what people
must have to live.
Food
Clothing
Shelter
• Wants – the things we
would like to have,
but can live without.
Economic Choice
You make an economic choice when you only have money
for certain items, not all.
Example:
I do not have enough money for both popcorn and a pretzel. I must
choose, so I buy the popcorn. That is my economic choice.
YUM!
Opportunity Cost
Opportunity cost what you must give up
when you make an economic choice.
Example:
I chose the popcorn, so I have to give up the pretzel.
That is my opportunity cost.
Supply and Demand
• Supply is the amount
of a good or service
available.
• Demand is what
people are willing and
able to buy.
I would like to buy one candy cane, please.
Scarcity - Sometimes there is not enough of
something to go around. That item is scarce.
The Ice
Cream
Singers
Oh no! Ice cream is scarce!
“I scream, you scream, we all scream
for ice cream! La, la, la, la, la!”
What can I do with my money?
• Spend it
• Save it
• Invest it
Give people money to use to
make more moneys, like in stocks
and bonds.
Goods and Services
• Goods
• Services
Three types of resources work together in our
economy
Human Resources
Natural Resources
Capital Resources
Natural Resources are things we get from nature.
Oil
Coal
Trees
Water
Human resources are jobs done by humans at
work.
Capital resources are the machines, tools and
buildings needed to do a job.
Producers
Producers make goods or provide services.
Consumers
Consumers use or buy goods and services.
Economic Specialization
Individuals or groups who concentrate on
one type of good or service.
Apple farmer
Carpenter
Interdependence
People need each other for goods and
services.
The Ancient Greeks traded their goods across the
Mediterranean Sea.