Economics

1
Economics

• Scarcity and the Factors of Production

2
Study of Economics

• Economics is the study of how people seek to
  satisfy their needs and wants by making choices.
• Why?

3
Scarcity

• Scarcity is at the heart of economics if there
  were no scarcity, there would be no need for
  economics
• Scarcity refers to the fact that there is a
  limited quantity of almost all things that people
  want
• Sooner or later a limit is reached

4
Scarcity

• These things are called goods and services
• Goods are any physical items or objects that are
  desired by people most goods are available in
  scarce quantities
• Services are actions or activities that a person
  performs for someone else

5
Scarcity vs. Shortage

• A shortage occurs when producers cannot offer
  goods or services at the current prices
• Shortages can be temporary or long-term
• Droughts, wars or worker strikes can produce
  shortages

6
Factors of Production

• Land - Natural Resources
• Labor - Skills of People
• Capital - Goods Used To Make Other goods, but not
  money
• Physical Buildings or tools
• Human Knowledge or skills

7
Who makes Resources into Goods?

• Entrepreneurs a leader who combines land, labor
  and capital into marketable goods and services
• They take risks to develop ideas, start
  businesses and create industries for the main
  reason of profit

Bill Gates