1. Costs of Production Lesson
Introduction to Economics Students will identify the costs of production; profit and loss, and total revenue

2. Bell Work Read to yourself the information on the handout.
Be prepared to share out

3. The Invention Convention
Key Vocabulary:
Profit
Loss
Revenue (Total)
Costs of Production

4. Revenue – total costs = Profit
Profit- is the total revenue minus total costs
Revenue – total costs = Profit
$5,000 – $2,000 = $3,000

5. Revenue – total costs = Profit
Loss
Loss-if total costs exceeds revenue creating a negative figure which means a loss.
Revenue – total costs = Profit
$2,000 – $5,000 = $3,000

6. Selling Price X Quantity Sold = Total Revenue
Revenue (Total)-a products selling price multiplied by the quantity sold
Selling Price X Quantity Sold = Total Revenue
$ X 5 = $25.00

7. Costs of Production
Costs of Production- average per unit cost multiplied by the quantity produced
Calculate the total cost of each resource used by price per unit X number of units used.
This will give you the Total Resource Cost
Add up ALL of the Total resource costs This will equal your TOTAL Invention Cost for One Unit
Rent = .75 X 1 = $.75
Labor= .25 X 2 = $.50
Total = $1.25

8. Resource Price List

9. Each group will present their new inventions to the class
Presentations
Each group will present their new inventions to the class

10. Calculating Profit
1. Fill in column 1 with the Invention Name and column 2 with the total Quantity sold
Your group will need to do the following:
2. Calculate how many units sold?
3. Calculate the Total Revenue?
4. Calculate the Total Cost?
5. Calculate the Total Profit or Loss?

11. Which Business had the highest Profit
WHO?????? Yeah!!!!!!!

12. Why did they have the highest profit?

13. Closure
What resources do producers need to produce goods and services?

14. natural resources, human resources and capital resources