![Page 1: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/1.jpg)
The Main Idea
Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge the health of our economic system, we use a variety of economic indicators.
![Page 2: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/2.jpg)
Key Concepts
The Changing U.S. Economy
Measuring Economic Activity
![Page 3: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/3.jpg)
Who has fat stacks?
Who thinks they have the most money on them right now?
Who is the tallest in here?
Who has the highest GPA?
![Page 4: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/4.jpg)
Measuring Economic Activity
Economic indicators measure things such as:
how much a country is producing
whether the economy is growing
how the economy compares to other countries
![Page 5: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/5.jpg)
The Changing U.S. Economy
Sometimes major shifts in certain growth areas can change the emphasis of the U.S. economy.
The United States has experienced four major economic shifts.
![Page 6: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/6.jpg)
Graphic Organizer
1600s 1700s 1850s 1900s Present
Bartering and tradingcreated our
service-based economy
Farming created our agriculture-based economy
The Industrial Revolution started
the industry-based economy
The invention of computers created the information-
based economy
We live in the information age,
but still rely upon the other types of
economies
![Page 7: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/7.jpg)
Gross Domestic Product
gross domestic product (GDP)The total dollar value of all final goods and services produced in a country during one year.
Measuring gross domestic product (GDP), involves computing the sum of goods and services sold to businesses, consumers, the government, and other countries.
![Page 8: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/8.jpg)
Components of GDP – what goes into it?
1. Consumer spending for food, clothing, housing and other spending.
2. Business spending for buildings, equipment, and inventory items
3. Government spending to pay employees and to buy supplies and other goods and services
![Page 9: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/9.jpg)
Components of GDP (cont’d)
4. The exports of a country less (MINUS) the imports into the country
Ex: Exports – Imports = the money you can count towards your GDP
USDebtClock
![Page 10: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/10.jpg)
Categories of GDP spending
Consumer Spending
Business
Gov't
Exports
![Page 11: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/11.jpg)
What counts towards GDP?
You are out mowing your lawn. What counts towards GDP?
GDP doesn’t include value of work you do for yourself. BUT included in GDP is everything you bought to cut your lawn.
![Page 12: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/12.jpg)
What doesn’t count towards GDP?
Only final goods are counted when you measure GDP
Ex: Only a finished car is measured in GDP, everything that went into that car wasn’t counted – ex - the steel and fabric
Intermediate goods would be counted twice (Steel and fabric)
![Page 13: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/13.jpg)
That’s not cool…
China overtakes US economy
![Page 14: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/14.jpg)
GDP per capita
Another way to measure economic growth is GDP per capita.
Calculated by:
GDP÷ total population.
GDP per capitaOutput per person
![Page 15: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/15.jpg)
Group ActivityGet a partnerIn presentation software, create a presentation about the countries given to you and include:-Title slide-Country-Flag-Map of where country is Population-GDP-GDP per capita -unemployment rate-personal income level (if available)
% changes for:-Population-GDP-GDP per capita2010 vs 2013/2014-Works cited page in MLA format
![Page 16: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/16.jpg)
![Page 17: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/17.jpg)
GDP per capita
Reminder:
Calculated by-
GDP÷ total population.
USDebtClock
![Page 18: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/18.jpg)
*140+/- million people work in the US
Labor force consists of all people over age 16 who are actively working or are seeking work
Unemployment rate is the portion of people in the labor force who aren’t working.
Employment
![Page 19: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/19.jpg)
Labor force – I don’t get it
Labor Force
Unemployed
Not part
of the Labor force
Students, retired people, people who can’t work or don’t want to
![Page 20: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/20.jpg)
Employment
People are “unemployed” if:
1.They are looking for work
2.Willing/able to work
3.But can’t find a job
Unemployment rateThe portion of people in the labor force who are not working
![Page 21: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/21.jpg)
Employment
The unemployment rate measures the number of people who are able and willing to work but cannot find work during a given period.
Unfortunately, not everyone is able/willing to work
Students, retired people, and others who cannot or do not wish to work are NOT part of the labor force!!!
![Page 22: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/22.jpg)
Types of Unemployment – don’t need to write these down
Frictional – caused by changing jobs; little effect on the economy
Seasonal – workers are needed only part of the year
![Page 23: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/23.jpg)
Types of Unemployment (Contd)
Structural – new technology replaces workers, requiring new skills or companies merge and eliminate jobs
Cyclical – the entire economy slows down
Try finding our current unemployment rate
![Page 24: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/24.jpg)
Productivity1890’s average worker put in about 60 hours of work in a week
Now we work around 40 hours a week but we produce WAY more goods and services….how is this?
– Technology
– Management techniques
– Better worker training
![Page 25: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/25.jpg)
Productivity
A vital source of economic growth is an increase in output per worker.
productivityThe production output in relation to a unit of input
(how many cans of chicken noodle soup can be produced with the number of staff working at the time)
![Page 26: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/26.jpg)
Personal Income
Personal income funds provide the foundation for buying needed goods and services.
Personal incomeSalaries and wages as well as investment income and gov’t payments to individuals.
![Page 27: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/27.jpg)
Retail Sales
On a monthly basis, the U.S. Dept of Commerce measures retail sales by consumers.
Increasing retail sales usually points towards economic growth
Retail salesSales of durable and nondurable goods bought by consumers
![Page 28: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/28.jpg)
Retail Sales
Main items measure for estimating retail sales include: automobiles, building materials, furniture, gasoline, clothing as well as purchases from restaurants, dept. stores, and food and drug stores
![Page 29: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/29.jpg)
Retail SalesDurable and nondurable? What does that mean?
Durable –
– a consumer good that typically lasts longer than three years
– Furniture, jewelry, cars, appliances
Nondurable –
– a consumer good that typically lasts less than three years
– Food, cosmetics, medicines, clothes, shoes, small electronics
![Page 30: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/30.jpg)
Partner Activity
On paper or electronically, list all the consumer goods and services you used from yesterday morning until you went to bed
Count them up when finished
![Page 31: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/31.jpg)
Categories of GDP spending
Consumer Spending
Business
Gov't
Exports
![Page 32: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/32.jpg)
You are a purchasing agent for a large furniture manufacturer. You have received several bids from lumber companies for a supply of teak, a very dense and decay-resistant type of wood. The lowest bid comes from a lumber company that has been known to abuse the environment.
Decision Making How does the lumber company’s reputation affect your decision? Explain your answer.
![Page 33: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/33.jpg)
Answer
Students might suggest that all aspects of the company’s reputation should be considered before making a decision to buy from the company.
![Page 34: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/34.jpg)
1. What do economic indicators measure?
Economic indicators measure the economic health of the nation.
![Page 35: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/35.jpg)
2. How do we find GDP per capita?
GDP ÷ by total population of a country
![Page 36: The Main Idea Throughout the years, the U.S. economic system has changed. Each change affected what was produced and how people were employed. To gauge](https://reader036.vdocument.in/reader036/viewer/2022062421/56649e685503460f94b64c90/html5/thumbnails/36.jpg)
3. What are the main sources of personal income?
Wages, salaries, investment income, and gov’t payments.