Limited Resources

1. Limited Resources Limited Resources - SOL 2.9

2. Consumer A person who uses goods and services

3. Producer A person who uses resources to make goods and/or provide services

4. Consumers and producers need each other.

5. Consumers need producers to make the goods and services they buy and use.

6. Producers need consumers to buy the goods and services they want to sell.

7. Most people are BOTH producers and consumers.

8. Washing the dishes is an example

9. In order to wash dishes, you CONSUME water and soap.

10. When you are done, you have PRODUCED clean dishes for the next meal.

11. Exercise on Consumers and Producers Simple Simon Meets a Producer

12. Scarcity Scarcity means that there are not enough resources to meet all wants at the same time.

13. Economic Choices People have to make economic choices because resources and goods and services are limited.

14. Opportunity Cost What a consumer has to give up to get something else when there is scarcity.

15. Example: If Mary only has enough money to buy either a cookie OR a donut, then she has to give up one to buy the other.

16. Example: If she buys the cookie, the donut is her opportunity cost.

17. Example: If she buys the donut, the cookie is her opportunity cost.