EconomicsBy Paul Curcione

Definition of EconomicsThe study of how people and

societies choose to spend their money based on the amount of money they have available to spend.

TradeI’ll give you this; you give me

thatMy stuff for your stuff or for your

services or for your $$$

TradeTrade between 13 colonies and

the mother country

Opportunity Cost (Lost)What you give up in order to get

something you want more

Opportunity CostWhat did King Ferdinand give up

(lost) in order to finance Columbus?

SpecializationYou are going to make one thing great,

instead of trying to make many things not so great.

SpecializationDifferences in the economies of

the 13 colonies (New England, Middle, Southern)

Geography affects decision on how to make $

SpecializationAllows me to make more stuff

which means more $$ for me. The more I can make, the more I can sell, right?

But, I also depend on other people making other stuff for me because I don’t make everything I need.

Voluntary ExchangeSimilar to trade. Two parties or

countries exchanging stuff for their mutual benefit

Voluntary ExchangeLewis and Clark did this. What

did they exchange?

ProductivityMake more $$$ by selling your

stuff, or spend less $$ while making your stuff.

ProductivityHow does technology affect

productivity? I.e., steamboat, steam

locomotive, telegraph

Price IncentivesAnything that reduces the cost of

an item (discount, sale, coupon, etc)

Price IncentivesWhat do people want to spend

their $$ to buy? I.E. – Virginia settlers grew what?

Supply and Demand PrincipleThe greater the DEMAND for some stuff,

the more money you can ask for it.

The less the SUPPLY available of stuff, the greater the price you can ask for that stuff.

I.E. – (then) – tobacco for cigarettes

I.E. – (now) – gasoline for cars

Personal BudgetIncome In vs. Expenses OutFixed vs. Variable expensesWants vs. NeedsImportance of saving $$Why budget (monitor) money?

Fixed vs. Variable CostsOne stays the same; the other

differs

Wants vs. NeedsOne you HAVE to have; the other

you just WANT

Wants vs. Needs

SavePut $$ away; don’t spend it all

BudgetPlan on how much to spend and

save

Benefits and CostsWhat are the benefits and costs

of budgeting?What are the benefits and costs

of saving?What are the benefits and costs

of making purchases?

The EndIf you spend your money wisely

you might grow up to be as rich as me!

You know I love kids!