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Economics 101. Do Now:. When you think of the word Economics what comes to mind?. What is Economics?. The study of how people and nations make choices about how to use scarce resources to fulfill their needs and wants…. Needs Versus Wants. Needs versus Wants. Survival 1. Shelter 2. Food - PowerPoint PPT Presentation
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Economics 101
When you think of the word
Economics what comes to mind?
Do Now:
The study of how people and nations make choices about how to use scarce resources to fulfill their needs and wants…
What is Economics?
Needs Versus Wants
Needs versus Wants
Needs Wants
Survival1. Shelter2. Food3. Water4. Healthcare5. Education
Everything you desire but may never get
Everything else that isn’t a basic need
Good versus ServiceGood Service
Object, something you buy
Something done for you for a fee
ResourcesResources Human Resources
What you use to make your needs and wants
Natural Resources- Land, Water
Resources are always scarce!!!
Workers
Factors of Production:Land Labor
The natural resources The land you use for
your business or what land your building is on
Workers
Factors of Production:Entrepreneurship Capital
Someone who has an original idea
All the things you need for your business
Financial Capital: money to run your business
Factors of Production
Technology
The science or process behind producing the goods or services
Also known as “Knowledge”
Examples:Vamsi’s Car Repair Shop Land:
Labor:
Capital:
Entrepreneurship:
Technology:
Examples:
Parteek’s Pizza Shop
Land:
Labor:
Capital:
Entrepreneurship:
Technology:
Scarcity versus ShortageScarcity Shortage
Once it is gone it may never come back
You may not have it right now but it will come back
Temporary
Because we have limited resources we have to make choices
We can’t fulfill everyone’s needs and wants
What does this matter?
Choices:
Trade Off Opportunity Cost
The next best thing What you gave up
The “cost” or value of what you gave up
Not always a monetary value
Choice: Tradeoff: Opportunity Cost:
Examples:
Choices in Production:Production Production Possibilities
Making goods and services
Manufacturing
All the possibilities you can make from your resources
Examples:Kush’s Pig Farm
Production Possibilities:
Form of Production:
Rahi’s 100 Acres of Land
ProductionPossibilities:
Form of Production:
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