Economy and Kids Making Economics Fun Again!

Why Do Economics and History Go Together?

When most people think of economics, they see a lot of graphs, letters, arrows, and numbers. When most people think of history, they see a lot of names, dates, and maps. For that reason, most people think these subjects are ‘difficult’ because they really see them as ‘boring.’ Changing that perspective might be challenging for teachers, educators, and parents. After all, kids have a hard time changing their mindsets. However, by simply combining these two subjects in an interactive way, both subjects can become engaging. After all, both history in economics and economics in history are living and dynamic. Start...

The Economy of the Southern States

Economy plays a large role not only in the future, but in a society’s past. Here is an example of how economy shaped history for an entire country. In this article, we will cover the American Civil War as whether or not the civil war was inevitable. When the Industrial Revolution crossed the Atlantic into the United States, it settled mostly in the North. Part of this reason is that water was the main power source of the industrial mills, and it was easier to build by the great waterways of the North. The other part of the reason is...

Economics: Production Possibility Frontier

Now that we have learned about the definition of economics, and about the differences between macroeconomics and microeconomics, we can now talk about the Production Possibility Frontier. It sounds complicated, but we will break it down in a bit. First, let us show how it is related to economics. To review, economics is the efficient allocation of scarce resources. Remember, because these resources are scarce, or limited, whoever practices economics cannot simply do whatever he wants, or buy everything he wants. Instead, he should choose where he wants the resources to go—in other words, allocate them to different things. Following...

Economics: The Law of Diminishing Marginal Utility

As we have been discussing, economics is really the study of how people make decisions, based on what they want to get. Economics has many numbers, graphs, and other calculations that depend on numbers, but it only tries to predict how people will act, based on human nature. The economic law that is probably the most easy to relate with, is the Law of Diminishing Marginal Utility. The Law of Diminishing Marginal Utility says, you will get the most satisfaction from the first unit of something that you have, eat, see, and so forth. For the second unit, you will...

The Difference Between Macroeconomics and Microeconomics

We have already discussed the definition of economics. To review, economics is the efficient allocation of scarce resources. Basically, this means that economics is made up of the decisions people make on where to assign or distribute their limited resources, so that they get the most out of them. Economics is actually separated into two kinds, or branches: macroeconomics, and microeconomics. “Macro” literally means “large,” or “large-scale.” Macroeconomics is the study of economics on a large scale (we’ll discuss that more later). On the other hand, “micro” literally means “very small,” or “especially small.” So microeconomics is the study of...

Why Do Prices Rise?

You’ve probably heard your parents complain about the price of gas going up, or how expensive milk is becoming, or about rent and tuition fees and all those other grown-up things. Economics also explains why prices go up, and most importantly, it explains how they go up. Review: Supply and Demand Since the supply and demand graphs are part of every basic economics concept, let us go back to them and review how they change prices. Remember: the higher the supply, the lower the price. The higher the demand, the higher the price. Both the suppliers and the demanders need...

Economics: The Law of Comparative Advantage

So far, we have only been talking about what economics is like for one country, or one nation, or one kind of good. But obviously, there many people, many countries, and many goods being bought and sold. We are going to talk about one of the laws of economics that applies to several people or countries, and several goods, at once: the Law of Comparative Advantage. The Law of Comparative Advantage says that each nation should produce, or each person bring, whatever good is cheapest for them to bring. Why? Because each nation, and each person, is trying to practice...

Economics: The Point of Equilibrium

Now that we have talked about the Law of Supply and Demand, we can talk about Equilibrium. First, let us review the Laws of Demand and Supply, and then the single Law of Supply and Demand. The Law of Demand says two things. First, the cheaper something is, the more people will want to buy it. Second, the more people want to buy something, the more expensive it will become. On the other hand, the Law of Supply says two things. First, the more expensive something is, the more people will want to sell it. Second, the more people are...

Economics: Opportunity Cost

We have already talked about the definition of economics, about macroeconomics and microeconomics, about the laws of supply and demand, and how they work together. Now, let’s look at another basic economic idea: Opportunity Cost. Opportunity Cost means this: if we want to buy something or spend time on something, then it means that there is something else that we are not buying or spending time on. Confusing? Let’s look at an example. Say a student is trying to decide between buying a chocolate bar and a milkshake. He only has money enough to buy one of them. If he...

Economics: The Law of Supply and Demand

We have already talked about the Law of Supply, and the Law of Demand. Now, let us put them together and look at this basic law of economics, the Law of Supply and Demand. Now, first, let us review the Law of Demand. The Law of Demand says, the more expensive something is, the less people will buy it. Also, the more people want something, the more expensive it will get. For the Law of Supply, it says that the more expensive something is, the more people will sell it. On the other hand, the more sellers there are, the...