Lesson 4 – The Economy

1. Lesson 4 – The Economy Entrepreneurship 110

2. Reading Assignment • Read pages 69-71 of textbook • Complete the graphic organizer.

3. Complete the following chart:

4. Economy Defined • The “Economy” can be defined as: • The use of resources to produce and distribute goods and services.

5. The Three “Ages” • The three “Ages” of the Economy are: • The Agricultural Age (non-specific – 1750) • The Industrial Age (1750 – 1975) • The Information Age (1975 – present)

6. The Agricultural Age (? – 1750) • The majority of people lived in rural areas and worked as farmers and merchants. • Customers knew who was producing goods and services that they consumed. • Hard work and physical labour were valued. • Entrepreneurs first emerged during this age.

7. The Industrial Age (1750 – 1975) • People began to move from rural areas to urban areas (which became cities). • Equipment and machinery was invented to mass produce goods. • The focus was on quantity, not quality.

8. Cont’d • Entrepreneurship was discouraged during this age. Employers wanted workers to follow routines, not have original ideas. • Working conditions were dangerous and wages were low. As a result, some of the first ever unions were formed.

9. The Information Age (1975 – present) Here are some startling facts: • More information was produced in the last 20 years than the previous 5,000 years • Information is doubling every 4 years • A typical weekday edition of The New York Times contains more information than a person would encounter in a lifetime in the 17th century • 80% of new jobs require sophisticated information handling skills

10. More Facts • Jobs that involve the Internet pay about 50% more than jobs that do not • Artificial intelligence is expected to affect 60-90% of all jobs in organizations--supplementing, relocating, or eliminating workers • In the next five years, 80% of workers will be doing jobs differently from the way they have done them over the past 50 years

11. Information Age • We are in it! • For the first time, information and knowledge are valued more than anything else. • Computers are so important during this age because they have changed how we share information of all kinds.

12. This resulted in two main effects on workers: • Fewer are needed, as they are replaced with computers/robots. • Those who remain employed work longer hours, as they can work “anywhere.”

13. Alvin Toffler, a Sociologist said the following about the Information Age: • “The illiterate of the 21st Century will not be those who cannot read and write, but those who cannot learn, unlearn and relearn.” What does this quote mean?

14. Quote Explained • What Alvin Toffler is saying in the previous quote is: • How we receive and transmit information is changing by the day. • We must be able to learn how to transmit information (operating a Discman), unlearn (leave that information behind) and relearn (operating an MP3 player/Ipod). • If you are unable to do this, or refuse to, you will be considered “illiterate.”

15. Interesting to Consider… • Every year Time magazine nominates a “Person of the year.” • In 2006 that person was…

17. With your neighbor, do an analysis of the Time magazine cover. • Specifically, what is meant by the following: • “You control the Information Age. Welcome to your world.”

18. Labour

19. Labour and Its Importance • Read the reading and complete the questions

20. Hand out • Labour and Importance Reading & Questions

21. Answer to Assignment • Labour can be defined as productive human work. Although now, it is mostly the production of a good/service in exchange for a wage/salary. • Farmers would grow their crops or raise their livestock and trade them for other goods or services using a barter system of exchange. • Specialized Labour: People became experts at doing just a few things or even one thing. Workers became more productive. This meant that workers could improve their standard of living, if they were able to gain a share of the additional wealth they helped produce.

22. This was a disadvantage b/c workers became “deskilled” and forced into repetitive work. They had to depend on others for the goods & services they needed but didn’t produce. • Natural Resources – bestowed by nature and comes from the land, ex. fish, trees, etc. • Capital Resources – man made, used in the production of goods. (saws, drills, pizza ovens) • Wage – amount of $ made over short-term (by the hour/week/job) • Salary – amount of $ made over long-term (usually by the year)

23. The Changing Workplace • The new economy is forcing workplaces to change the way they operate if they want to be successful. Factors influencing these changes include • Globalization • Competition • Applications of new technology • E-commerce • The focus on quality • The needs of employers/employees • Changing customer demands (Green products, Organic) • The current economic situation • Concerns for human rights (Not using child labour)