Transcript Unit One AP Econx

AGENDA, AP ECONOMICS
8/20/12
1) Check HW (Notes, answers to questions)
2) Definition of Economics
3) Reff’s Laws of Economics
4) Reff’s Intro to Economics online lesson (found on Haiku under
assignments)
5) Review of reading (terms, ideas)
6) FRQ practice
HW: Read/note/answer questions for Module 2 for Wednesday
WHAT IS ECONOMICS?
Your definitions….
REFF’S PRINCIPLES OF ECONOMIC THOUGHT
1) People are rational – their behavior is consistent with what they want
2) Marginal costs and benefits are different than cost/benefit
3) “It depends” is almost always the best answer in economics (but then
you explain WHY it depends)
4) People are maximizers. They want to get more instead of less.
5) Decisions are always made at the margin.
MODULE ONE REVIEW
“The Economy”
Types of Economies:
1)
2)
MODULE ONE REVIEW
Incentives
Marginal decisions/analysis/marginal benefit/marginal costs
Factors of Production
MODULE ONE REVIEW
Opportunity Cost
Macroeconomics vs. Microeconomics
Positive/Normative economics
AGENDA, 8.22.12
1) Check notes!
2) Go over concepts (fill in gaps/blanks)
3) Unemployment article – read, discuss
4) Business cycle – video
5) Go over questions from end of Modules ½
6) HW: Modules ¾
7) REMINDERS: work on notecards as you go, summer reading
project, AP Contracts (I have 14 of 20)
CONCEPTS, MODULE 2
Business Cycle (4 parts)
How do we define a “recession”?
CONCEPTS, MODULE 2
Employment
Unemployment
Labor Force
“Rates”
CONCEPTS, MODULE 2
Output
Aggregate output
(aggregate =
)
CONCEPTS, MODULE 2
Inflation (http://www.youtube.com/watch?v=5e81WRzb03U)
Deflation
Price stability
CONCEPTS, MODULE 2
Economic Growth
Models!
MODELS IN ECONOMICS
HOW DID OUR ECONOMY GET IN A RECESSION?
ONE theory is a real-estate crisis with sub-prime mortgages caused the recession:
http://www.youtube.com/watch?v=qqUGoVez8xg&feature=related
QUESTIONS FROM MODULES 1/2
AGENDA, 8.24.12
1)Check Modules ¾ Notes
2)Go over concepts
3)Reff online simulation
4)Youtube video on Comparative Advantage
5)Practice
6)HW: Graphs!!
CONCEPTS
PPC =
How do we set it up?
Reading a PPC
CONCEPTS
Inside/Outside/On the PPC
Efficiency/Inefficiency/Impossible
Efficiency in alloctation/production
Unemployment?
CONCEPTS
PPC:
-
Constant Opportunity Cost versus Increasing Opp. Cost
-
Expansion of the PPC – when does this happen?
CONCEPTS
CONCEPTS
Trade leads to specialization – why?
Absolute Advantage versus Comparative Advantage
CONCEPTS
How do you figure out absolute and comparative advantage?
1) Read the PPC
2) Chart out opp. Costs
1)OC = give up/do instead
3) Determine absolute adv.
4) Determine comp. adv for each
When does it NOT make sense to trade?
AGENDA, 8.28.12
1)Check HW
2)Go over Graphs
3)Reff online simulations
4)Watch Youtube videos (4)
5)Practice – together, individually
6)HW: Modules 5 & 6
GRAPHS IN ECONOMICS
•
Variables
•
Causal relationship
• Independent variable
• Dependent variable
GRAPHS IN ECONOMICS
Linear relationship
positive relationship
negative relationship
Calculating slope
GRAPHS IN ECONOMICS
Nonlinear Curves
Maximum/Minimum points
Calculating area
GRAPHS IN ECONOMICS
Time-series graph
Scatter diagram
Pie chart
Bar graph
NOW…
-
REFF simulation: linked on Haiku
-
You tubes:
http://www.youtube.com/watch?v=FpTBjRf8lGs&list=PLD5BC727C84E254E5&i
ndex=3&feature=plpp_video
-
http://www.youtube.com/playlist?list=PL2902F0F35B834106&feature=plcp
-
Practice
- Together: work from textbook
- Separate: handout (turn in for classwork grade)
AGENDA, 8.30.12
1) Check HW (Modules 5/6)
2) Comparative Advantage: Together (on board), Individual
(Worksheet)
3) Determinants of Supply/Demand Assignment (on Haiku)
4) Graphing Supply & Demand
5) HW: Module 7
Reminders: AP CONTACT, LAST DAY FOR DROP/ADD
COMPARATIVE ADVANTAGE
Greece can make 60 pounds of fish and 80 bushels of wheat. Poland can make
35 pounds of fish and 70 bushels of wheat.
1) What is the opportunity cost of fish for each country?
2) What is the opportunity cost of wheat for each country?
3) Which country has a comparative advantage in fish?
4) Which country has a comparative advantage in wheat?
5) 1 pound of fish will exchange for more than ___ bushels of wheat but less
than ___?
6) 1 bushel of wheat will exchange for more than ____ lbs of fish but less than
___?
AGENDA, 9.4.12
1) Check HW (Module 7) & Chart from class Thurs
2) Announcements – article review & summer reading
extended to Friday, 9/14!!
- next week: out for Sophomore Retreat
3) Supply and Demand
4) Equilibrium
5) Practice
6) HW: Modules 8/9
DEMAND/SUPPLY
Setting up the graph
“Q” and “P”
Showing shifts (arrows)
Movement /Shift
DEMAND/SUPPLY
Law of Demand (what is it, why does it always curve down?)
Law of Supply (what is it, why does it always curve up?)
*Move R on Demand Curve = quantity demanded increases, move L on Demand
Curve, quantity demanded decreases
*Shift R = demand increases, Shift L = demand decreases
NEVER “UP” or “DOWN”
DEMAND/SUPPLY
5 Factors that Shift Demand:
- change in price of related good or service
- Substitutes:
- Complements:
- change in income
- Normal Goods
- Inferior Goods
- Changes in tastes/preferences
- Changes in expectations
- Changes in the # of consumers
Note: yes, price BUT not
price of good, price of
related good/Service!!
DEMAND/SUPPLY
5 Factors that shift supply:
-
Changes in input prices
- What is an input?
-
Changes in the price of related goods/services
-
Changes in technology
- What is “technology”?
- Changes in Expectations
- Changes in # of Producers
Note: yes, price BUT not
price of good, price of
inputs and related
goods/services
EQUILIBRIUM
What does E “look” like?
How do we find the price?
Noting it on the graph (E, P, Q)
Surplus
Shortage
AGENDA, 9.6.12
1) Check Modules 8, 9
2) Finish Equilibrium (when does it change? How?)
3) Practice S/D, Equilibrium
4) Price Controls – Ceilings, Floors, Quotas
5) Practice Price Controls
6) HW: Start vocab!
EQUILIBRIUM – INDIVIDUAL SHIFT
When demand decreases…
E price & E quantity both fall
When demand increases…
E price & E quantity both rise
When supply decreases…
E price rises, E quantity falls
When supply increases….
E price falls, E quantity rises
EQUILIBRIUM – BOTH SHIFT
Remember….
When one decreases and one increases, price rises/falls but we don’t know about
quantity
When both increase/decrease, quantity increases/decreases but we don’t know
about price
PRACTICE – SUPPLY AND DEMAND OF UGLY MUG COFFEE
1) Create curves from Demand & Supply Schedule
2) Identify Equilibrium, EQ, EP
3) The price of Donut Shoppe coffee drops. Explain what this does to your
graph and denote on graph
4) Draw a new graph. The cost of raw coffee beans rises. Explain what
this does to your graph and denote on graph.
5) For Graph A and B, mark the new equilibrium and explain what it does
to Q & P
6) Another producer has entered the market (Mrs. J’s coffee) but at the
same time people start liking energy drinks more. Draw two basic
graphs showing what happens to equilibrium price and quantity. In one
graph, have the quantity rise and one fall. Explain why they differ with
the same scenario.
PRICE CONTROLS
Price Ceiling
Price Floor
**assumption is markets are efficient prior to price control
When does a price ceiling cause shortages?
How do we remember
which is which for Ceiling
and Floor on graphs?
PRICE CONTROLS
Negative Results of Price Ceilings:
-
Inefficient Allocation to Consumers
-
Wasted Resources
-
Inefficient Low Quality
-
Black Markets
PRICE CONTROLS
Negative Results of Price Floors:
Inefficiency Low Quantity
-
Inefficient allocation of sales among sellers
-
Wasted Resources
-
Inefficient High Quality
-
Illegal Activity
QUANTITY CONTROLS
Quotas
Demand and Supply Price
Wedge/Quota Rent
QUALITY CONTROLS
Side Effects:
-
Missed opportunities (deadweight loss)
-
Illegal activities
PRACTICE – PRICE AND QUANTITY CONTROLS
1) 1)
What is the original equilibrium price
for gasoline?
2) A price ceiling of $1.50 is
implemented for gasoline. How will
this affect consumers in the
marketplace?
PRACTICE – PRICE AND QUALITY CONTROLS
In this scenario a price ceiling has
been placed for amplifiers.
1) What is the price floor?
2) What is the result in the
marketplace?
PRACTICE – PRICE AND QUALITY CONTROLS
1) Draw the supply/demand graph for swordfish
2) On that supply/demand graph, illustrate the implementation of the quota
described.
3) What is the result of that quota?