and allocation of those resources Productive Resources and allocation of those resources

Standards SSEF1b: Define and give examples of productive resources SSEF1c: List a variety of strategies for allocating scarce resources

What are Productive Resources? Anything used to produce goods and services 4 types of Productive Resources. We call them the “Factors of Production” Or FOP’s CELL Capital, Entrepreneurship, Land, Labor

FOP: Land “Gifts of nature” Anything that occurs naturally Examples:

FOP: Labor the physical abilities and time of human beings available to produce goods and services.

FOP: Capital the tools, machines, and skills/knowledge/training of human beings. Physical Capital – tools, machines, etc. Human Capital – skills, knowledge, and/or training of individuals.

FOP: Entrepreneurship someone who takes a risk to start a business by bringing together the other three factors of production in an innovative way.

Allocating Scarce Resources Society has to decide how to allocate its scarce resources. Allocate: To distribute (according to a plan)

Allocation Strategies Authority Governments make the decision Authoritarian governments = use military/police for enforcement of resource allocation. Rationing of a resource Supply/Demand More supply = Lower price Less supply = Higher Price

Allocation Strategies Random Selection/ (Lottery) Everyone has an equal chance of getting resource Inefficient = resources go to those who don’t need it/want it. Ex: Farm land First come/First Served First in line gets the resource: Concerts Sporting events Stores

Allocation Strategies Personal Characteristic Resources are distributed based on need or merit. i.e.: Scholarships, Jobs Contest Resource go to the person who wins. i.e.: Race, Academics (valedictorian), Test of knowledge

Standards SSEF1b: Define and give examples of productive resources SSEF1c: List a variety of strategies for allocating scarce resources List 5 facts that will help you remember this lesson: