Economics Concepts and Activities: Chapters 1-3 (Introductory)
Chapter 1: Introduction to Economics
Key Concepts:
Scarcity: The fundamental economic problem of having unlimited wants and
limited resources.
Opportunity Cost: The value of the next best alternative forgone when
making a choice.
Production Possibilities Frontier (PPF): A curve showing the maximum
combinations of two goods that can be produced with given resources.
Microeconomics vs. Macroeconomics: The study of individual economic units
vs. the study of the economy as a whole.
Positive vs. Normative Economics: Objective analysis vs. subjective value
judgments.
Activities:
Scarcity and Choice:
Create a personal budget and identify your limited resources (time, money).
List your wants and prioritize them. Analyze the opportunity costs of different
spending choices.
Imagine you have a limited amount of land. Decide what goods you would
produce on that land, and what the opportunity cost of each good would be.
PPF Practice:
Draw a PPF for two goods (e.g., pizza and books). Show how changes in
technology or resources affect the PPF.
Create a table of data points, and then graph that data into a PPF curve.
Micro/Macro Sorting:
Find news articles or economic headlines. Categorize them as microeconomic
or macroeconomic issues.
Create a list of 10 economic sentences, and then label each sentence as
either Microeconomics or Macroeconomics.
Positive/Normative Statements:
Write 5 positive economic statements, and then 5 normative economic
statements. Exchange with a classmate, and then analyze each others
statements.
Chapter 2: Supply and Demand
Key Concepts:
Demand: The quantity of a good or service that consumers are willing and
able to purchase at various prices.
Supply: The quantity of a good or service that producers are willing and able
to sell at various prices.
Market Equilibrium: The point where supply and demand intersect,
determining the equilibrium price and quantity.
Shifts in Demand and Supply: Factors that cause the demand or supply curve
to move.
Elasticity: The responsiveness of quantity demanded or supplied to changes
in price or other factors.
Activities:
Supply and Demand Graphs:
Draw supply and demand curves for a specific product (e.g., coffee). Show
how changes in factors like income or input costs affect the curves and
equilibrium.
Create a table of price and quantity data for supply and demand, then graph
the data, and find the equilibrium point.
Market Simulation:
Conduct a mock market simulation in your class. Assign roles to buyers and
sellers and observe how prices and quantities adjust.
Play online market simulation games.
Elasticity Calculations:
Find real-world examples of products with elastic and inelastic demand.
Explain why the demand is elastic or inelastic.
Practice calculating price elasticity of demand using given data.
News Analysis:
Find news articles that describe events that would shift supply or demand
curves. Explain which curve is shifted, and the reason for the shift.
Chapter 3: Market Structures
Key Concepts:
Perfect Competition: A market with many buyers and sellers, homogeneous
products, and free entry and exit.
Monopoly: A market with a single seller and significant barriers to entry.
Monopolistic Competition: A market with many sellers, differentiated
products, and relatively easy entry and exit.
Oligopoly: A market with a few dominant firms and strategic
interdependence.
Market efficiency.
Activities:
Market Structure Identification:
Identify real-world examples of different market structures. Analyze the
characteristics of each market.
Create a table that compares and contrasts the different market structures.
Case Studies:
Research case studies of companies operating in different market structures.
Analyze their pricing strategies and competitive behavior.
Analyze the effects of a monopoly on consumers.
Debate:
Debate the pros and cons of different market structures (e.g., perfect
competition vs. monopoly).
Debate if certain industries should be regulated monopolies.
Product Differentiation:
Think of a product, and then think of ways to differentiate that product, to
make it fit into a monopolistic competition market.
Tips for Success:
Active Reading: Read your textbook and assigned readings carefully, taking
notes and highlighting key concepts.
Practice Problems: Work through practice problems and exercises to reinforce
your understanding.
Study Groups: Form study groups with classmates to discuss concepts and
work through problems together.
Seek Help: Don’t hesitate to ask your professor or teaching assistant for help
if you’re struggling with a concept.
Real-World Connections: Try to connect economic concepts to real-world
events and examples.
Online Resources: Utilize online resources such as Khan Academy,
Investopedia, and other reputable websites.
By actively engaging with these concepts and activities, you’ll build a solid
foundation in introductory economics
