1 Chapter pp. 4-17 A Look at Wants and Needs

Learning Objectives After completing this chapter, you’ll be able to: State the differences between wants and needs. Describe how limited resources relate to wants. continued

Learning Objectives After completing this chapter, you’ll be able to: Identify business activities that are used for products and services. List the two factors that motivate businesses. continued

Learning Objectives After completing this chapter, you’ll be able to: Explain the relationship between business and you.

Why It’s Important Businesses satisfy people’s basic needs all the way to their lavish wants. Competition and profit motivate these businesses to continually strive for your business.

Key Words wants needs goods services resource business profit continued

Key Words competition consumer

An Abundance of Wants Wants are the things you wish you could have. Each person has wants. A group of people may also share the same wants. Although these wants are shared, they are considered private wants.

An Abundance of Wants Some wants are widely shared by many people. These wants are no longer considered private but become public wants, such as highways, drinking water, and education.

An Abundance of Wants For the most part local, state, and federal governments satisfy public wants.

expression of yourself. Figure 1.1 WANTS AND NEEDS OF YOUR SANCTUARY You need your own “space.” Studies show your bedroom is an expression of yourself. How would you revamp your space if you could?

Satisfying Wants and Needs With Goods and Services Necessary wants are needs. Food, shelter, and clothing are basic needs.

Satisfying Wants and Needs With Goods and Services Goods can be physically weighed or measured. Goods satisfy your wants and needs for material things that you can see or touch.

Satisfying Wants and Needs With Goods and Services Services are tasks that people or machines perform. Services also satisfy some of your wants for things you can’t see or touch.

Satisfying Wants and Needs With Goods and Services In a business context wants are not about intangible desires such as love and respect.

Unlimited Wants, Limited Resources Most people have unlimited wants for goods and services. The more money you make, the more goods or services you want.

Unlimited Wants, Limited Resources A resource is anything that people can use to make or obtain what they need or want. Examples of resources include fuel, timber, labor, and money.

Unlimited Wants, Limited Resources The problem of unlimited wants and limited resources affects individuals, companies, and nations.

Unlimited Wants, Limited Resources Resources limit the number of wants people can satisfy. Businesses and government are influenced by the same problem.

Deciding on Your Resources People make the most of their resources by making the right choices about what to buy.

Deciding on Your Resources The decision-making process is a step-by-step method to carefully consider alternatives that result in better choices.

Deciding on Your Resources The decision-making process has five essential steps: Identify the problem. List the alternatives. Determine the pros and cons. Make the best decision. Evaluate your decision.

Economics’ Starting Points Graphic Organizer Graphic Organizer Economics’ Starting Points GOODS Tangible Material Things SERVICES Tasks Performed RESOURCES Anything people can use to make or obtain what they want or need WANTS Things you wish you could have NEEDS Necessary wants

Define wants, needs, goods, services, and resources. Fast Review Define wants, needs, goods, services, and resources. What is the difference between public wants and private wants? continued

List the steps in the decision-making process. Fast Review List the steps in the decision-making process.

What Is Business? Business is any activity that seeks profit by providing goods or services to others.

What Is Business? Businesses provide you with necessities. Businesses also provide people with the opportunity to become wealthy.

What Business Does A business must organize the people and equipment to provide the product. People within the organization manage the company’s resources to produce the product.

What Business Does The company markets the product or service by deciding where to sell it and how to advertise it.

Business’s Motivations Profit is the amount of money left over after a business has paid for the cost of producing its goods and services. Profit is the motivation for taking the risk to start a business.

Business’s Motivations A business is profitable when sales are high and costs are kept low.

Business’s Motivations Companies thrive on competition, or the contest between businesses to win customers.

RIDING THE SEA OF CHEESES Figure 1.2 RIDING THE SEA OF CHEESES Cheese lovers’ tastes are changing to specialty cheeses. While cheddar and mozzarella are mainstays, sheep’s and goat’s milk cheeses are moving straight ahead to your nearest deli counter. Imagine you want to become a cheese maker. What kind of cheese would you make. Why?

Business and You Businesses make many decisions that impact you. However, you also affect business.

You as a Consumer A consumer is a person who selects, purchases, uses, or disposes of goods or services. Business is aware of your changing needs and wants.

You as a Consumer Businesses affect you when they discontinue products. The decision to stop manufacturing products is often because there is a decreasing demand.

You as a Consumer When a company is slow to respond to customers’ complaints and doesn’t communicate very well, then customers usually find another company’s product to buy.

You as a Wage Earner In order to make products and provide services, businesses hire people to work. In order to produce a product, the business decides how it will be produced.

You as a Wage Earner In business today, workers have more input about how business is done. When you’re an employee, quality of work, decision-making skills, and input to problems help a business flourish.

Fast Review Define business. List the business activities that happen behind every product or service. continued

How does business affect you as a consumer and as a wage earner? Fast Review How does business affect you as a consumer and as a wage earner?

Self-Discovery in Business Changes in the price of consumer goods, company bankruptcies and interest rates affect your life. What happens in business and government will make a difference to the world you live and work in.

The Value of Knowledge When you become a business owner, manager, or employee, you’ll need business knowledge. The more education you have, the better your income.

What Do You Like? Learn as much now in order to make an informed decision in the future. Explore all the business opportunities in order to see what is available to you in order to satisfy your wants and needs.

Why is it important to understand business today? Fast Review Why is it important to understand business today? How will knowledge help your career?

Business Building Blocks Evaluating Information You often depend on information from other people and sources. You need to evaluate that information to decide whether it’s reliable. continued

Business Building Blocks Evaluating Information Asking questions about the information can help you evaluate it. continued

Business Building Blocks How to Test Information Does the source of information have real knowledge about the subject? What are your source’s personal biases? How can these influence his or her thinking? continued

Business Building Blocks How to Test Information Is the information as current as it needs to be? Is the information based on a large enough sample? Does this survey represent the majority of the people? continued

Business Building Blocks How to Test Information Is the information relevant to your problem?

Does the media sway the public’s wants and needs? How do environmental laws affect some businesses? continued

How are colleges going to meet the increased demand for continuing education courses? continued

Why is diversity an important stimulus to the workforce?

1 End of Chapter A Look at Wants and Needs