Monday factors of production
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Transcript of Monday factors of production
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Bellringer 8/13 - 8/14/20121. Write a business idea you think might
make you wealthy.2. What specifically would you need to
start this business? (for example, to start a Landscaping company would
need a truck, shovel, and some rocks)
3. Why do you think most people just end up getting a job, instead of being
entrepreneurs?
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Profit Motive• Buy low and sell higher
• People want profits
• Consumer Sovereignty
• Adam Smith “invisible hand”
• Voluntary trade increases wealth
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“Free Market” Economic System• Laissez Faire – French for “leave alone”
• Guided by “invisible hand”
• Stossel clip
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Mixed Economies• Modern countries have the government help
some• For example….
• Schools• Roads• Healthcare• Child care• Space Travel
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What economic opportunities do you see in this picture?
May 2008
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What keeps our economy moving?
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Factors of Production• Items we need to be in business
• 3 categories + 4th idea
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Land• Any natural resource
– Rosemont mine example
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Labor• People working
• Wages $
• Benefits
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Sub note to LaborHuman Capital
• Skills, experience, education a person has• It’s the reason doctors are paid more than sandwich
artists
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Capital• Goods used to create other goods/services
• Usually the largest cost for entrepreneurs
• Explanation for “Capitalism”
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Let’s build a new Circle K!
• Land
• Labor
• Capital
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New Ideas!Real job creation
• Entrepreneur – French word
• Person who takes a risk combines land, labor and capital to start a new business– OR comes up with a new idea
within a business
Empresario