1. Needs All humans have basic needs, these are essential if people are to survive. A need is what we need to survive. There are five basic needs, what are they? 1. 2. 3. 4. 5.

2. Five Basic Needs Clothes Five Basic Needs Food Drink Shelter Warmth

3. Wants All humans have unlimited wants !

4. Wants All humans have unlimited wants! A want is what we would like but do not need to survive. The number of wants an individual can satisfy is often limited due to financial reasons. Usually, when a want has been achieved an individual will then desire something else.

5. Goods §Goods are physical objects that can be bought. §There are 2 types of goods; §Can you describe the difference

6. Goods §Single use item - goods that can be used only once (list 10 examples) §Consumer durable – goods that can be used over and over again (list 10 examples)

7. Goods §What is the difference between these goods?

8. Consumer Goods Vs Producer Goods §Consumer goods are those goods which are consumed by consumers (the general public) – (give 5 examples) §Producer goods (or capital goods) are good which are purchased by other businesses to produce other goods and services (give 5 examples)

9. Services §A service refers to when someone performs a task for you (or things that other people do for you). They almost always involve a human element!! ( list 10 different services) §Producer services are those services which meet the needs of other producers. §Can you think of any producer services’ ?? (list 5)

11. OPPORTUNITY COST §Which one would you buy – if you could afford it. ???

12. Choices There are a limited number of resources in the world (finite) Businesses and individuals have to make choices, the wants that are not satisfied are sacrificed. Examples A new car or a holiday?New trainers or a jumper? A night out to the cinema or bowling? A drink or a packet of crisps? Activity Write down examples opportunity cost that you have made.

13. Opportunity cost Opportunity cost: is the value of the next best alternative given up when a choice is made. There are a limited number of resources in the world (finite) Businesses and individuals have to make choices, the wants that are not satisfied are sacrificed We are all forced to make decisions involving choice due to scarcity of resources. In pairs think of an example of opportunity cost for each of the following; 1.You 2.Your family 3.A business 4.A government

14. So what is a business?

15. What is a Business? Individuals have to purchase most of their goods or services as it is not possible to produce their own. A business is formed to provide GOODS or SERVICES to satisfy the demand for peoples needs and wants

16. Review You should now know……….. 1)The five basic needs 2)The difference between a need and a want 3)The difference between a good and a service 4)The concept of opportunity cost 5)What a business is

17. Demand When individuals make choices, this leads to Demand. Businesses need to produce products or services that satisfy needs / wants at a price people are prepared to pay. Demand is always at a price. If a business sets the price too high, people will go without or find a suitable alternative. The business may then have produced (supplied) too many. Set the price too low and the business will lose out on potential profit. The business may also struggle to supply enough.