1. GOAL: Study Scarcity
Warm-up: List all of the things that you could/might buy if I gave you $20 to spend in the next 24 hours…

2. PRODUCERS
FACTORS OF PRODUCTION
PRODUCTS
__________
Natural Resources
__________
________Resources
Capital Resources
Services
______________ship

4. Look at the pictures. Which ones shows goods and which ones show services?1. 3. 2. 5. 6. 4.

5. Choice In a World of Scarcity
The Scarcity Principle
Boundless wants cannot be satisfied with limited resources.
Therefore, having more of one thing usually means having less of another.
Because of scarcity we must make choices.

6. MOMS
Stay at home
Go to Work

7. SCARCITY

8. Scarcity, Choice, and Opportunity Cost
Every society has some system or mechanism that transforms that society’s scarce resources into useful goods and services.

9. Scarcity, Choice, and Opportunity Cost
Human wants are unlimited, but resources are not.
Three basic questions must be answered in order to understand an economic system:
What gets produced?
How is it produced?
Who gets what is produced?

10. If things are scarce…
What do nations/companies hope to increase???

11. Productivity
Level of output from a level of input….

12. Ways to increase Productivity
Division of labor…
Specialization…
Small number of tasks per worker
Focus on one activity to increase productiviy…

13. Scarcity leads to… TRADE-OFFS  One good sacrificed for another good
Make money versus being home to raise
Being home to raise versus work world
OPPORTUNITY COSTS  The next best option that you gave up