Economy 3 eso bilingual

1. The economy:

2. We have different kinds of
needs:
some are basic, and we
must cover them to survive
Others are secondary: they
increase our welfare
But.... Are resources
used to produce goods
unlimited or is there a
limit on what we can
produce?

3. Advertising: creating needs
• Advertising stimulates us to thinkt we need a
product by creating a need for it: it will make
us more beautiful, younger, powerful etc
• There are conventional advertisements on TV,
newspapers...
• But advertisements evolve to new formats:
internet advertisements adapt to our
preferences by checking the pages we’ve
visited
• There are hidden advertisements in movies
and TV series: Actors use certain brands
which pay to appear on screen. This is called
“product placement”
• Advertising works: it’s a proven fact that the
repetition of the same mesage time and
again can really drive us to buy the product
What’s exactly selling this ad?

4. How to consume?
Choosing the
best options
according to
price-quality
ratio
Choosing products
and services from
companies that
develop social
responsibility
programs
Trying to consume products which are fair with the
environment
Knowing and demanding my rights as a
consumer

5. Production, distribution, consumption
• To produce something we need
several things:
• 1) Capital: it’s the money we
need to buy raw materials, pay
salaries…
• 2) Material resources: they cam
be raw materials or any sort of
fabric, metal etc
• 3) Human resources: they give
their time and their know-how
to do the job
• 4) Technology: having the most
advanced technology will
reduce the time needed to
produce the good increasing its
quality and lowering its price
• We need distribution networks to
make the product reach the
consumer
• Distribution and logistics plays a key
role in the correct functioning of
economy as factories and
consumers are quite away from
each other (people do not visit the
Factory to buy a car isn’t it?)
Depending on these factors we can
have a HIGH or LOW PRODUCTIVITY
• Consumption is the act by which we
acquire goods and services. It’s very
important, as each one of us is a
consumer, and we consume on a
daily basis

6. THE FAMILIES
THE COMPANIES
THE STATE
• Are basic units of
consumption
• They work to obtain
an income (salaries)
that they must
manage
• They pay taxes
• There are private companies (who
pursue a monetary profit) and
public or state-owned companies,
which pursue a social benefit even
if they loose money
• They offer products (goods) and
services
• They create jobs
• They pay taxes
• The state is a great consumer of goods and services
offered by companies.
• State can also produce its own goods and services
through its public companies
• It plays a role as regulating agent of the economy as
it mints the currency, collects the taxes and makes
the laws
• It creates jobs (teachers, police, Treasury agents...)
The three
basic agents
of economy

7. TAXES
Direct taxes
• They apply on our incomes
and properties
• For instance, if I own one
car, one house and one
parking place, each year, I
have to pay because I’m the
OWNER
• Each year, all citizens must
declare their income so the
State can
Indirect taxes
• They apply on the things
and services we consume
• Each time we buy
something, we’re paying
taxes although we don’t
realice it.
• Several products (gasoline
for example) pay different
taxes at the same time, but
the most commonly known
is the VAT (Value Added Tax)
RECUERDA: SOLO EL ESTADO COBRA IMPUESTOS

8. La historia del dinero comienza alrededor
del siglo VII al V antes de Cristo con la
primera acuñación de moneda.
The history of money begins around the seventh
century BC to V with the first coinage.
El dinero es cualquier objeto que es aceptado para el
pago de bienes, servicios y deudas en un mercado
Confiamos en el dinero porque lo respalda un estado.
Dependiendo de la fuerza de la economía que la
respalde, una moneda tendrá más o menos valor,
aunque hay monedas que no emiten los estados, como
el Bitcoin
Money is any object accepted for the payment of
goods, services and debts in a market.
We trust in money because it is supported by a
State. Depending on the strength of the economy
behind a currency, it will be stronger or weaker,
although there are some currencies which are not
backed by a State, such as it happens with Bitcoins
El dinero

9. Al principio se usaron objetos como conchas como
dinero, pero pronto aparecieron las primeras monedas,
hechas de metales preciosos como el oro o la plata.
In the early ages, objects like shells were used as
money, but coins appeared soon. They were made of
precious metals like gold and silver.
A lo largo del tiempo el dinero físico
ha perdido valor: las monedas de hoy
ya no son de metales preciosos y los
billetes solo son un trozo de papel. La
tarjeta de crédito y el pago por el
móvil están acabando con el dinero
como objeto
Through time, money has lost
value as an object. Our coins are
not made of precious metals
and notes are just pieces of
paper. Credit card and mobile
phone payments are ending up
with money as a physical thing

10. The role of banks
• Banks play a multiple role:
• They hire our savings,
paying us a little interest
• They also buy money to the
state paying a low Price (in
our case they buy it to the
Central European Bank)
• They loan the money they
save charging a higher interest
rate
• They also invest their money
in the Stocks Exchange
market, so they own great
companies (for instance La
Caixa owns 12% of REPSOL
and 5% of Telefónica)
• With their control on big
companies and money, Banks
are also influential on
politicians and governments.
• In some countries, there are
state-owned Banks that lend
money in better conditions
tan private ones. These Banks
have been dismantled in
Spain.