1. What is economics?
Economics is making decisions about how to distribute limited resources to satisfy unlimited wants

2. Every society has limited productive resources
Human Resource (labor)
Capital Resource (tools)
Natural Resource (land) +
Entrepreneurship (risk)
Which are used to produce
Goods &
(objects)
Services
(activities)

3. Natural Resource (land), Capital Resource (tool), Human Resource (labor), or Entrepreneurship (risk) ?

4. NATURAL RESOURCES (land)
Raw materials; made by nature
Used to make other goods
Ex. trees, oil, water, minerals
Goods used to make other goods
Ex. tools, machines, factories
More & better capital goods help workers to make products more quickly and more cheaply
CAPITAL RESOURCES (tools)

5. HUMAN RESOURCE/CAPITAL (labor)
A worker’s health, education, experience, training, skills, and values
Ex. social studies class, a computer training course, medical care, & parent lectures about being on time and honesty
Raise salary, improve health, or add to a person’s good habits

6. ENTREPRENEURSHIP (risk)
The rare mixture of the qualities needed to create and run businesses.
People who have these qualities risk their time, money, and energy to make a profit.
An entrepreneur recognizes human wants and takes risks to provide a good or service to satisfy those wants.
They might create new products, come up with new ways to make things, or find new ways to reach buyers
ex. Bill Gates (Microsoft), Ben & Jerry (ice cream), Donald Trump (real estate, tv)

7. Decide whether the following pictures are an example of a natural, capital, human resource, or entrepreneurship.

31. Resources are used to produce GOODS & SERVICES

32. GOODS
have shape and can be seen & touched
can be stored for later use
Ex. cars, clothing, & machines
SERVICES
cannot be touched
must be used as soon as they are provided
Ex. hair styling, medical care, and equipment repair do not have a physical presence

33. Decide whether the following pictures are a good or a service
CLAP your hands for goods
STOMP your feet for services

34. good = clap service = stomp

35. good = clap service = stomp

36. good = clap service = stomp

37. good = clap service = stomp

38. good = clap service = stomp

39. good = clap service = stomp

40. good = clap service = stomp

41. good = clap service = stomp

42. What’s it made of challenge?
Natural Resource (land), Capital Resource (tool), Human Resource (labor), Entrepreneurship (risk)

43. What’s it made of?
Pick 1 of your favorite goods or services
Decide what resources were used to make your good or service
natural resources
capital resources
human resources
entrepreneurship
Try to name as many resources as you can

44. Got Milk? Natural Capital Human Entrepreneur Pasture land Grass/ grain
Air
Water
Cows
Oil/gas
trees
Buckets
Barn
Fence
Stool
Truck
Factory building
Plastic/ cardboard
Farmer
Truck driver
Grocer
Farm owner
Trucking company owner
Grocery store owner

45. INPUTS
Natural
Resource +
Capital
Human
OUTPUTS =
Goods &
Services

46. Because all of these resources are limited, SCARCITY occurs…
The condition that exists because human wants exceed capacity of available resources to satisfy those wants
Put this in English for me!!!!!!!

47. For a resource to be SCARCE, it must be…
Limited in quantity
Be desirable
More than one valuable use

48. However, because of scarcity choices must be made to answer the questions . . .
What goods and services will be produced?
How will goods and services be produced?
Who will consume the goods and services?

49. This creates the need for an… What is the basic economic problem?
Command
(controlled)
Market
(free)
Economic System
What is the basic economic problem?
Every society must decide how to make the best use of its limited productive resources.
Scarcity, with the resulting need to choose among competing options, is the basic economic problem.