Monday March 23, 2015 Introduction to Economics Agenda Homework Introduction to Economics 4 Factors of Production CW

Civics and Economics Day 125

Introduction to Economics Notes

What is Economics? Economics- the study of how we make decisions in a world where resources are limited.

Micro vs. Macro Economics Micro Economics Study of how individuals and small businesses make decision. Macro Economics Study of how the government and society make decisions

Scarcity The fundamental economic problem is scarcity. Not having enough resources (things we use to make products) to produce all the things we would like to have. To combat that we have to decide What to produce, how to produce it, and for whom do we produce.

Scarcity Needs-things required for survival Examples: food, clothing and shelter Wants- things that we would like to have Examples: entertainment, vacations, and other comforts. As people we have needs and wants.

Resources/Factors of Production Resource/Factors of Productions Mr. Neanover’s Definition- Things you can use to make other things with Types of Resources Natural Human/Labor Capital Entrepreneurship

NATURAL RESOURCES The raw materials used to make a product. Examples-Water, cotton, wood, oil, fertile fields, abundant rain fall, forests, mineral deposits.

HUMAN/LABOR The human effort that goes into making a product. The people who run machines and do the work. Example: Carpenters, bricklayers, electricians

CAPITAL The tools, machines, and buildings used to make a product. Example: bulldozers, trucks, factory, wrench, drills, saws, nails, etc. Money is only considered capital when it is used to buy a factor of production

Entrepreneurship Individuals who start new businesses, introduce new products and improve management techniques. Usually the person who gives the money and has the idea.

4 Factors of Production Activity Write the name of the product and list out the 4 factors of Production! (DUE AT THE END OF CLASS) Ex: Under Armour Socks Natural Resources: Cotton, Elastic, Spandex Human Labor: People sowing the socks together Capital: Machines used to stich the socks and deliver them to stores Entrepreneurship: Creating cool designs and making them dry fit, causing them to stand out.