1. What is Economics?
Econ 8/15/17

2. Warm Up
Suppose I gave you $100,000 right now. What would you do with it? How much would you spend, and what would you buy? Would you save any? Would you invest any?

3. What is Economics?

4. What is Economics? Scarcity and the Science of Economics
I. The Fundamental Problem
Scarcity: society cannot fulfill everyone’s wants
Economics: how to satisfy unlimited and competing wants through use of scarce resources
Needs vs. Wants
Everything has a cost – a.k.a “there is no such thing as a free lunch”

5. II. Three Basic Questions
1. WHAT to produce
2. HOW to produce
3. FOR WHOM to produce

6. III. The Factors of Production
A. Land
1. Fields, livestock, climate – natural resources
2. Limited supply—potential problems?
B. Capital
1. Tools, equipment, machinery
C. Labor
1. Workers
D. Entrepreneurs
1. Creates new businesses, new products

7. Read pages 5 – 10, answer questions 3,4,5 on a separate sheet of paper due Thursday.