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ECONOMICS

ECONOMICS. Factors of Production Notes. What is Economics?. Economics is the study of how people choose to use limited or scarce resources in attempting to satisfy their unlimited wants. An economy is based on a system of economic activity in a country, region, or community.

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ECONOMICS

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  1. ECONOMICS Factors of Production Notes

  2. What is Economics? • Economics is the study of how people choose to use limited or scarce resources in attempting to satisfy their unlimited wants. An economy is based on a system of economic activity in a country, region, or community.

  3. What is Economic Activity? An economic activity is based on the production [making] and distribution [moving] of goods [what you buy] and services [how you are helped]. www.alliancetractortrailer.com/ training_shots

  4. Production – making goodsDistribution – moving goodsGoods – items you buyServices – things you do for someone else; how you are helped

  5. Based on the definitions on the last slide, do you think this is a good picture to describe ECONOMIC ACTIVITY? Why or why not? www.kcee.wichita.edu/ documents/postercontest

  6. 4 MAIN FACTORS OF PRODUCTION In order to understand economic activity, it is important to look at the factors that are necessary to produce the goods. Use the graphic organizer to fill in the definitions, examples, and influences of each of the four factors of production.

  7. FACTOR 1NATURAL RESOURCES --- LAND A natural resourceis anything that is part of the Earth and which people need and value [worth something].

  8. EXAMPLES OF NATURAL RESOURCES Two categories--- Non-renewable resources like coal, oil, natural gas, iron, salt, etc. and Renewable resources like fish/animals, timber (lumber, wood, trees), plants, soil, etc. From Science class, can you think of at least 4 more natural resources that would be of value to our lives?

  9. FACTOR 2HUMAN RESOURCES --- LABOR FORCE The labor force is the human work force available.

  10. EXAMPLES OF LABOR FORCE Workers and employees can come from all areas of society, including teenagers, adults, men, women, etc. In the past, other work force consisted of indentured servants, slaves, prisoners of war, etc.

  11. FACTOR 3CAPITAL RESOURCES --- MONEY Capital resourcesinclude the material wealth in the form of money or property/tools used to generate economic wealth

  12. EXAMPLES OF CAPITAL RESOURCES Capital resources include cash, money, bartered items, credit, loans, machinery used in production, etc.

  13. FACTOR 4ENTREPRENEURSHIP---PEOPLE WITH IDEAS Anentrepreneuris a risk-taking business person; also someone who takes a risk in creating a business or enterprise.

  14. EXAMPLES of ENTREPRENEURS Mark Cuban, owner of the Dallas Mavericks Ray Kroc, founder of McDonald’s Steve Jobs, founder of Apple Bill Gates, owner of Microsoft

  15. WHAT WOULD HAPPEN IF ANY OF THESE… NATURAL RESOURCES, HUMAN RESOURCES, OR CAPITAL RESOURCES …WERE IN SHORT SUPPLY? Brainstorm ideas and list at least 2 or 3.

  16. Now let’s practice…. Natural Resources Human Resources Capital Resources Entrepreneurship What would a dairy farm owner be a part of in the factors of production? What would the “dairy milkers” be a part of in the factors of production? What would the pastureland be a part of in the factors of production? What would the banker who approves the farm loan be a part of in the factors of production?

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