1. Economics

2. Economics
A system that includes all of the activities that people and businesses do to earn a living.

3. Economic Activities Primary – Raw Materials
Secondary – Using the raw materials to make something
Tertiary – Sell those things that were made/provide services
Quaternary – Don’t work with goods, but information

4. Types of Economies
Traditional – a system in which people grow their own food and make their own goods.
Market – a system based on private ownership, free trade and competition
Capitalism
Command – a system in which the central government makes all economic decisions

5. Study of Economics
The study of how resources are used to satisfy people’s wants and needs
The study of people trying to get all the things they want and having to decide what they want the most

6. Wants and Needs
Want: things that we wish for but could survive without
Needs: Things that are necessary for our survival
Both Wants and Needs can be satisfied by consuming a good or a service

7. Goods and Services
Goods: objects that satisfy people’s wants, something that you can hold in your hand or touch
Services: activities that satisfy people’s wants

8. Interdependence
When people rely or depend upon each other for help or resources in accomplishing production
I need you, you need me!

9. Marketplace
Anywhere there is an exchange of a good or a service between a producer and a consumer

10. Producer and Consumers
Producer: People who make a product to sell to consumers
Consumer: people who buy and use the goods to satisfy wants

11. Money Anything commonly used as a medium of exchange
Throughout history gold and silver have been the most common types of money
Today currency and checking accounts are used as money

12. Capital Resources
The tools and machines that help in producing the product

13. Human Resources
The people who put energy and time towards producing the product and getting it to market.

14. Natural Resources
“Gifts of Nature” (Soils, Air, Water, Plants, Minerals, Animals, Etc.)
They are present without human intervention

15. Overhead or Input
All of the resources that go into the production of a good

16. Productivity The amount of output per unit or input
The cost is directly related to the productivity

17. Productive Resources or Output
The finished product
Natural resources (land), Human Resources (labor), and the Capital Resources (Machines) are all needed in the production of a good

18. Advertising
How to make the public aware of what good or service you are selling.
CANDY!!

19. Specialization
When someone does a particular job in the production process

20. Scarcity
Takes place when there is not enough to go around to meet every ones wants and needs
Requires people to make choices about using goods and services

21. Supply and Demand
Market force that explains why items become scarce or cost more
Supply: How much is available
Demand: How much is needed

22. To much Supply and not enough Demand, prices go down

23. Too much Demand and not enough Supply, prices go up.

24. Opportunity Cost
When you choose between two things, the one you give up is your opportunity cost.