Scarcity, opportunity cost, and resources Factors of Production Scarcity, opportunity cost, and resources

Do Now: 1. Why do we have scarcity? 2. What is opportunity cost? 3. What is the term for a company or individual that can produce something using less resources than anyone else? 4. What is the term for an economy that has prices set by a government?

Essential Questions we are looking at today: What are the four factors of production? How do these factors influence production choices made by producers? How does scarcity impact these factors of production?

What do you think of the car? Make a list of all the resources that are used in the making of this car.

Brainstorm 1st-Think of how you would organize the list you just created. What categories would you put them into? 2nd- Find a partner and talk about your categories you came up with

Factors of Production: Four factors Capital Goods Labor Natural Resources Entrepreneurship

Capital Goods Man-made factor of production used by labor in making other products Tools Factories Machines

Labor Any form of human effort exerted in production. Can be skilled, unskilled, scientific, or artistic. AKA human resources

Natural Resources Any form of resources that go into producing goods or services. Ex: energy, mined materials, water, sun, oil AKA “Land” Sound familiar?

Entrepreneurship The individual responsible for combining and organizing natural resources, capital goods, and labor to produce a good or service. The person who decides the what, how, and where to produce things. Role could involve assuming the risks of business failure and/or providing the creativity and managerial skills necessary for production to take place.

Activity When I say go break into groups of 3-4 students. One group member should grab the materials and the other members should put the desks together in a table. After you get your materials please sit silently in your groups so I can explain the activity. GO!

Instructions When you’re in your groups: Organize the terms on your poster Potential category’s will be: Restaurant Bank School Textile Factory (clothing or fabric factory) Factor of production Natural, Labor, Capital, Entrepreneurship

Last part of organization Choose 2 resources that you believe to be the most important. Put a Star by them. Choose 2 resources that you believe to be the least important. Put a frowny face next to them. Choose 2 resources you believe to be the most inexpensive for their importance. Put a smiley face next to them. Choose 2 resources you believe to be the most expensive but necessary. Put a $ next to them.

Influences Scarcity Opportunity Cost Productivity Profit margin Inverse economic relationship Opportunity Cost Fields for farming Productivity Human capital Profit margin Minimize scarcity and maximize low cost factors