1. Factors of Production And Economic Systems
Obj: Students will understand how limited factors of production require economic systems to distribute resources.
Agenda:
Quiz
Inputs of Mustang?
Factors of Production
3 Minute Case Study
China’s Ghost Cities

3. The Factors of Production
Labor—exchanged for wages
Physical Capital—exchanged for interest
Investment—purchase of physical capital now with intent of benefiting later from it
Land, or natural resources—exchanged for rent
Entrepreneurship—bring together all else (pay interest, wages, and rent) in search of profit

4. Income
Due to the exchanges that take place surrounding factors of production, the sum of wages earned, rent paid, interest collected, and profits gained is called income
Factor payments
Welfare, scholarship, grants,
loans???

5. What is an economy? What does it do? What are its aims? Mechanisms?
How is one better than another?
Is there a perfect economy?
Definition…
A system that coordinates choices about production with choices about consumption, and then distributes goods and services to the people who want them.