Economics Satisfying Our Needs and Wants. Scarcity Goods and services are scarce because we cannot...
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Transcript of Economics Satisfying Our Needs and Wants. Scarcity Goods and services are scarce because we cannot...
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Economics Satisfying Our Needs and Wants
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Scarcity
• Goods and services are scarce because we cannot produce enough of them to satisfy everyone’s wants.
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Satisfying our Wants and Needs
• Goods – Things we can touch or see that satisfy our wants or needs.
• Services – Actions people undertake in order to satisfy their wants and needs.
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Production Resources
Businesses use three types of production
resources to produce goods and services.
Natural
Human
Capital
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Natural Resources
• Resources that are present without human interference
• “gifts of nature”
• Examples are land, timber and mineral deposits
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Human Resources
• Any human effort used to produce goods and services
• Examples include workers and their skills, training and education
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Capital Resources
• Tools of production
• Goods used to produce other goods or services
• Examples include tools, machinery and buildings.
• Money used to purchase these resources is called capital.
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Identifying Resources:
NATURAL HUMAN CAPITAL
cotton tractor marketing degree table saws computers
water driver’s license crude oil employees
factory building aluminum electrical license land
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Identifying Resources:
NATURAL HUMAN CAPITAL
cotton
water
crude oil
land
marketing degree
driver’s license
employees
electrical license
tractor
table saws
computers
factory building
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What is an economy?
• Part I – Introduction
• Part II – Economic Choices
• Part lll – Resources
• Part IV- Capital Resources Link
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What is an Economy?
Assignment - Video Voiceover
Create a video voiceover with your partner by creating a script to this video about economics.
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Levels of Economic Activity
• Primary – First level
• Secondary – Second level
• Tertiary – Third level
• Quaternary – Fourth level
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Primary Activities
• Businesses involved in gathering raw materials.
• Examples include mining and timber companies.
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Secondary Activities
• Businesses that add value to materials by changing their form.
• Examples include automobile manufacturers and textile factories.
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Tertiary Activities
• Companies that provide business or professional services.
• Examples include salespeople, teachers and doctors.
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Quaternary Activities
• Businesses that provide information, management and research services by highly-trained persons.
• Examples include property management or environmental research companies.
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Important Note:
The more developed an economy is, the
greater the number and variety of activities
you will find.
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Identifying Levels of Activity
_____ Hershey Chocolate _____ Pilot Gas Station
_____ Luck Stone Corp. _____ NTelos
_____ Law Well Drilling Inc. _____ Fry Appraisal Co.
_____Oak Lawn Mausoleum _____ Walmart
_____Augusta Medical Center _____ Hollister
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Identifying Levels of Activity
_____ Hershey Chocolate _____ Pilot Gas Station
_____ Luck Stone Corp. _____ NTelos
_____ Law Well Drilling Inc. _____ Fry Appraisal Co.
_____Oak Lawn Mausoleum _____ Walmart
_____Augusta Medical Center _____ Hollister
S T
P T
T Q
T T
ST
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Economic Systems
• The way people produce and exchange goods and services is called an economic system.
• Four types of economic systems: traditional, command, market and mixed.
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Traditional Economy
Goods and Services are traded without
exchanging money. Also called “barter”.
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Market Economy
Production of goods and services is
determined by the demand from consumers.
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Command Economy
Production of goods and services is
determined by a central government, which
usually owns the means of production.
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Mixed Economy
A combination of command and market
economies provides goods and services so
that all people will benefit.
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The End