DRAW A LINE SEPARATING TODAY & YESTERDAY 1) Write: Date: 01/04/11 , Topic: Economic Systems 2) Next line, write “ Opener #2 ” and then: 1) Write 1 high + 1 low in last 24 hours 2) Rate your understanding of yesterday: lost < 1-5 > too easy (3 is perfect) 3) Respond to the Opener by writing at least 1 sentences about : Your opinions/thoughts OR/AND Questions sparked by the clip OR/AND Summary of the clip OR/AND Announcements: None
Agenda 1) Health Care Case Study (as an intro to “What is Economics”) What you will be able to do: 1) Which economic system is best? Reminder 1) Print/Design Checks (must be real size)
Review 1) Scarcity : The assumption that everything is limited (time, objects, skills). 2) Economics *: Study of how resources are allocated *like all areas of social sciences, they are not pure sciences in that they rely on human behavior, and humans are not 100% predictable. The closest thing social science gets to real science is psychology. 3) Micro-economics : Resource decisions on an individual level 4) Macro-Economics : Resource decisions on a society level 5) Behavioral Economics : The psychology of resource decisions
What is Economics Study of resource allocation: 1) What is produced? 2) How to produce it? 3) Who do we produce it for?
Who should get the liver transplant a) Wealthy retired baseball player (90% chance of survival) b) Mother of 2 (50% survival chance) c) Teenager (20% survival chance) d) Nobel prize winner scientist (5% chance of survival)
Notes #2a , Title: “ Econ Systems Notes ” How do different econ systems decide: 1) What is produced? 2) How to produce it? 3) Who do we produce it for? Capitalism (Free Enterprise/Free Market): Individual ppl decide what, how, and for who based on price signals (greed makes things better) Communism : Gov decides what, how, and for who based (gov makes things better) Socialism : Let ppl make money, buy property, but uses taxes to ensure everyone has basic needs met (hybrid)
Capitalism (USA*) All Private Even US not 100% Socialism (Sweden) Gov Control Private Communism (North Korea) All Gov Control Even N Kor not 100%
Capitalism is a form of freedom. a) Capitalism is linked to freedom since it is about individual choice . b) However, active debate over if capitalism promotes democracy ( China ) c) Most the world are capitalists, even “communist” countries. ( Cuba and North Korea are the big exceptions ) d) Note, China is a communist country, because the political party in power is the Communist Party , NOT because their economic system is communism.
Team Quiz (10 Points) Discuss the following questions with your group. Make sure everyone understands how to answer it. Once the quiz paper is passed out, everyone individually writes their own responses. No talking once we start writing. 1 paper will be graded from each group ( 10 points ). Prepare now. Ask Mr. Chiang only if no one in your team knows. When writing, use sentences! 1) What is capitalism? 2) What is communism? 3) What is socialism? Bonus Q) In what ways is America between 2 + 3 5 Reading/Film Qs Come From These Work Sections
One of the most valued scarce resources: Health Care (Remember that scarcity is not just for objects, but for skills/services too). 1) $600 billion of federal spending, $2.4 trillion spending if including private 2) Family of 4 can cost biz $12k, employee paying $3k of that
Health Insurance Only a fraction will get sick, so as long as the premiums will pay for that sick fraction and make a profit, the system works.
Notes #2b , Title: “ Heath Care Notes ” 1) Health Care System a) Capitalist System: Those can afford buy private b) Light Socialist System (US): Gov uses taxes to provide health care for the poor (kids+elderly) i) Medic a id : Gov pays for health care for poor kids, parents, & disabled ($200 billion/$1300) ii) Medi c are : Gov pays for health care for over 65 ($400 billion/$2600) 2) Full Socialist System : Gov runs health care (nationalized) OR gov pays for all (single payer) 3) Why health care cost rise (3) : a) longer + more unhealthy life, b) more + more expensive medical options, c) inefficiency/reducancy
Notes #2b , Title: “ Economics Notes ” 4) Private Health Care Terms a) Premium : What you pay regardless of usage b) Co-pay : What you pay per visit c) Deductible : What you pay b4 insurance pays d) Coverage/exculsions : What will they cover e) HMO : Get all services from 1 comp (dr salaried) f) PPO :Get serv from list of private drs (dr fee based) g) POS : Mix of HMO/PPO h) Flex Account (125 Account) : Employer can set aside pre-tax dollars pay for health expenses (if you don’t use it up by end of year, it’s gone) i) Cobra : Law that says if lose job, you can pay to keep company h.c. temp (but pay full cost, so unemp often have no h.c.)
Notes #2b , Title: “ Heath Care Notes ” 5) Health Care Reform (3) : i) Control rising cost iii) protect those with health care ii) expand health care to uninsured (15% of US no H.C.) a) Public Option : Gov acts as health care provide, collecting premiums + paying for serv (DEM want, not get, it’s how Medicare works) b) “Obamacare”: i) All must get health care or pay fine, gov help pay for priv ins ii) ins comps can’t deny coverage for pre-existing illnesses iii) expand Medicaid 150% iv) kids can stay in parents’ ins till 26 (GOP wants to repeal plan)
Journ #2a , Title “ US Health Care ” 1) Copy Source Title: Frontline 2…) Discuss questions on the board with a partner. Summarize your discussion ( include their name at the end ). Remember participation points are deducted if off task. 5 Reading/Film Qs Come From These Work Sections Time Bookmark: 00:00
Homework: 1) Study today’s notes + work sections for a possible workbook quiz . 2) Design your checks due Friday (must be real size) 3) Bring 1+ items for Friday Marketplace Workbook Check: If your name is called, drop off your workbook with Mr. Chiang ( if requested, points lost if your workbook is not turned in )
Selling Simulation: “Friday Marketplace” Many people get experience earning money at a job, fewer people experience earning money through their own business. Have fun with it! Market: Each Friday’s Market Takes Place in 2 Rounds (1 Seller Round, 1 Buyer Round) 1) Sellers and buyers negotiate prices. 2) Take home all items you brought/bought at the end of the marketplace. 3) Carefully store your money and eventually deposit in bank. 4) Buyers beware, things sold “as is”, sellers persuade them of the utility of your items. No illegal, non-school appropriate, offensive, living, rotting, broken, or potentially messy items allowed.
Journ # , Title “ Marketplace ” Before the Simulation: 1) Write down your company name. Also write it on the small sign (marketing: you will improve upon this over time) After the Simulation: 2) Record your profits at end of the simulation 3) Reflect on what can be done better to increase business next time, focus on what products are in demand (not mean you can or want to supply it) and how marketing can be improved next time (branding+advertising). Remember, buyer beware!
Journ # , Title “ Closer Shareout ” Pick the 1 most important thing you learned today to share with your partner. 1) Write down a brief summary of what your partner said ( include their name ). 2) Rate 1-10 (1: confused, 10: too easy) how well you well you mastered today’s lesson.
Career Fair Default role is unemployed, at which you will get unemp benefit of $1280/mo. Current roles available: Banker: $4800/mo* ($30/hr, 8 per class) training req requires, 1 brunch session a week Landlord: $3200/mo* ($20/hr, 6 per class) training req, coming to class early during passion a wk *bonus possible based on performance Politician: $2400/mo ($15/hr, 3 per class) occas. brunch You will be fired if you can’t perform well!
Journ # , Title “ Econ Sim Prep ” 2) Pick 1 of the 4 banks, they are all the same, you should care about speed + reliability in choosing. Write down the bank name AND the name of the two bankers . Make sure the banker gives you $280 (2x100, 2x20s, 2x10s, 2x5s, 10x1s) 3) Rent a desk, write down your landlord’s name AND rent price (rent due Friday) 4) Write down names of your REPs. Last, fill out new seating chart circulating: First Name, Last Initial (Bill L), Bank Name