Just Another Manic Monday, Sept. 23

• Warm up: Quiz your neighbor about supply and demand, including the shifters!! We will have a quiz in five minutes.

• Learning target: I can compare and contrast four kinds of market structures—perfect competition, monopolistic competition, oligopoly and monopoly.

• Homework: – USATP Unit 2 #3 due TODAY by midnight!– USATP Unit 2 #4 due next MONDAY by midnight!

I DO NOT accept homework via email!

Arafat & Drego need to upload PDF or Word doc of current event to Edmodo.

Why does Ms. Browngive us so many darn quizzes?

2014 Top Ten Fortune 500 Companies’ CEOs’ Undergraduate Alma Maters

1. Wal-Mart -- University of Arkansas (MBA from U. of Tulsa)2. Exxon Mobil -- University of Texas3. Chevron -- University of California, Davis4. Berkshire Hathaway -- University of Nebraska5. Apple -- Auburn University6. Phillips 66 -- Texas A&M7. General Motors -- the General Motors Institute (now called Kettering Univ)8. Ford Motor -- University of Kansas9. General Electric -- Dartmouth College

10. Valero Energy -- U. of Missouri-St. Louis (MBA Our Lady of the Lake U.)Source: Bruni, Frank. Where You Go Is Not Who You’ll Be: An Antidote to the College Admissions Mania. New York, Hachette Book Group, 2016.

Market Structure Characteristics• How much competition is there?

1. Number of producers: The more businesses there are in the market, the more competition there is.

2. Similarity of products: The more similar the products are, the more competition.

3. Ease of entry: How easy is it to start a business in this market? Easier = more competition.

4. Control over prices: How much control does a producer have over overall prices? Less control = more competition.

• Read about market structures on the following pages in the new textbook: 127-131, 133-136, 141-146 and complete the graphic organizer.

• With your group, prepare a poster for an industry based upon the description and instructions given.

You are Special -- Tuesday, September 24

• Warm up: Create two index cards from you brains, NOT your notes: (1) pure/perfect competition market structure and (2) monopoly market structure.

• Learning target: I can compare and contrast four kinds of market structures—perfect competition, monopolistic competition, oligopoly and monopoly.

• JD missed yesterday’s quiz--please take it NOW• Homework:

a. USATP Unit 2 #4 due next MONDAY by midnight!

“My wife really wanted to go to the University of Virginia and didn’t get in. I really wanted to go to Georgetown and didn’t get in. So we both ended up at [the University of] Delaware. It was a place

where all of us felt that if we worked hard, we could do well. I never felt like the school wasn’t going to

give me the tools to be successful.” -Chris Christie, Governor of New Jersey and 2016

presidential candidate Source: Bruni, Frank. Where You Go Is Not Who You’ll Be: An Antidote to the College Admissions Mania. New York, Hachette Book Group, 2016.

Why does Ms. Browngive us so many darn quizzes?

Market Structure Characteristics• How much competition is there?

1. Number of producers: The more businesses there are in the market, the more competition.

2. Similarity of products: The more similar the products are, the more competition.

3. Ease of entry: How easy is it to start a business in this market? Easier = more competition.

4. Control over prices: How much control does a producer have over overall prices? Less control = more competition.

Work Period:

(1) 15 minutes to finish market structures graphic organizer

(2) With a partner or on your own, create a graphic equation poster that explains the industry you have been assigned.

(3) Using your graphic organizer and the industry description, follow the instructions for completing a graphic equation.

You are Valued--Wednesday, Sept. 25

• Warm up: Create two index cards from you brains, NOT your notes: (1) monopolistic competition market structure and (2) oligopoly market structure.

• Learning target: I can compare and contrast four kinds of market structures—perfect competition, monopolistic competition, oligopoly and monopoly.

• Homework: a. USATP Unit 2 #4 due next MONDAY by midnight!

“[The University of Delaware] offered me a good amount of scholarship and grant money. . . . My family was not affluent at all, and it made a huge difference. The second reason was, I went down there and visited--it’s strange the way you make decisions when you’re seventeen or eighteen--and everybody seemed happy and everybody seemed to be enjoying themselves. The campus was nice and it was relatively close to home. It wasn’t a whole lot more complicated than that.”

-Chris Christie, Governor of New Jersey and 2016 presidential candidate, about choosing U. of DE Source: Bruni, Frank. Where You Go Is Not Who You’ll Be: An Antidote to the College Admissions Mania. New York, Hachette Book Group, 2016.

Work Period1. 20-30 minutes: finish graphic equation poster2. Gallery walk

• Number of producers: Lots of businesses• Similarity of products: Identical• Ease of entry into market: Few restrictions; very

easy to start a business in this market.• Control over prices: Very little; there are too many

producers for one business to influence prices.

• Number of producers: One business

• Similarity of products: One-of-a-kind

• Ease of entry: Very difficult

• Control over prices: One business can control prices

Government- created monopolies

Natural monopolies

Monopolies are illegal in the U.S.

unless authorized by government.

Why?

• Number of producers: Just a few• Similarity of products: The same, with minor variations• Ease of entry: Difficult (mostly because of high cost of

starting a business in this market)

Oligopoly = four top producers supply more

than 60% of goods/services in that

market.

• Control over prices: One business can have control over prices that will cause a response by competitors and create “price wars” (e.g, car companies offering 0% financing)

• Sometimes they will set prices, called Collusion, which is illegal.

• Number of producers: Large number of producers

• Similarity of products: Similar but with product differentiation.

• Ease of entry: Relatively easy

• Control over prices: Some control over prices

Most common kind of market structure.

Pantene $14.50 Frederic Fekkai $54Product differentiation

You can make the effort!Thursday, September 26• Warm up: Warm up: Find your blue unit overview

sheet--underline standards we have covered so far. Put a star * by vocabulary words we have used and that you know; put two stars ** by vocab words we have used that you DON’T know.

• Unit 2 test next Wednesday, October 2• USATP Unit 2 #3 due Monday by midnight• USATP Unit 2 #4 due Tuesday by midnight

Market Structures--Let’s Finish!

• Get out your graphic organizers for market structures (one for your research and one for the gallery walk)--what posters do you still need to see?

How Are Businesses Organized?

Business Organization: Our Final Unit 2 Standard

Compare and contrast three forms of business organization (sole proprietorship, partnership, and corporation) with regards to number of owners, liability, lifespan, decision-making, and taxation.

Business Organization: Number of OwnersHow many people own a business?● Just one?● A few?● Thousands?

How does the number of owners affect the way a business is run?

Business Organization: Liability

● Liability: Being responsible for something● Who is liable (responsible) for the debts (loans), losses or other

costs of the company?○ E.g., if you borrow money from the bank for your sole

proprietorship, can the bank take your savings account if you don’t pay back the loan?

○ If you own shares of Home Depot Corp and Home Depot doesn’t pay back a loan, can the bank come after your savings account?

Business Organization: Lifespan

● Lifespan: How long something will last or function● What happens to different business organizations if the owners

die?

Business Organization: Decision-making

● Who makes decisions for different business organizations?○ For example, who decides what products to make?○ Who decides to hire employees?○ Who decides to take out a loan or move to a new location?

Business Organization: Taxation

● How will the income or profits of the business be taxed?● How will the owners of the business be taxed?

Work Period1. Research the three types business organizations using

pages 60-70 in old green textbook, OR pages 159-168, 171-174 in the new purple textbook AND the handout

2. Complete the graphic organizer about business organizations--this is due by end of class today!

Work Period

Using pages 60-70 in a textbook and the handout, complete the graphic organizer about business organizations.

You will use this information to make a presentation to the class on Wednesday!

Sole Proprietorship• Businesses owned and run by a single person who

has the rights to all profits and unlimited liability for all debts of the firm.

• Easy to start, but owners have unlimited liability for all debts of the company.– i.e., if the business can’t pay debts, the owner

must use his/her personal money to repay

• The most common form of business organization in the U.S.

Partnerships• Unincorporated business owned and operated

by two or more people who share the profits and responsibility for debts

• In a partnership, each partner fully shares responsibility for the operation of the business and all profits or losses.

• A partnership has many of the same advantages and disadvantages of a sole proprietor.

Corporations

• A corporation is a formal, legal entity all its own.

• One of the most important forms of business

• Individuals who wish to incorporate must file incorporation papers with the state where the business will have its headquarters.

Business Organization Questions

• Talk to your partner and read the textbook about each of these questions and fill in the back of your G.O.

• In each of the three structures,

– Who earns profits?

– Who is responsible for debts?

– How easy can the business raise money?

– Who makes final decisions?

How Are Businesses Organized?

Sole Proprietorship• Easy to start, but the owner has unlimited liability for

all debts of the company.– i.e., if the business can’t pay debts, the owner

must use his/her personal money to repay

• Taxation: the owner is taxed on the profits of the business

• The most common form of business organization in the U.S.

Partnerships• Each partner has unlimited liability for all debts

of the company.

• Taxation: the partners are taxed on the profits of the business

Corporations

• The owners (i.e., shareholders) are NOT liable for the debts of the corporation. The corporation itself is liable b/c it is a formal, legal entity.

• Taxation: “double taxation” when corporate profits are taxed AND when the earnings (“dividends”) of owners are taxed as personal income.