economics 1 1 notes lower version 2
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• Economics Economics – The study of choices that people make The study of choices that people make
to satisfy their needs and wants.to satisfy their needs and wants.
Microeconomics
Macroeconomics
Choices made by actors such as households,
companies, and individuals.
Choices made by much larger
actors like governments.
Consumers & Producers
To fulfill their need and wants
Goods and Services
Physical objects.
Actions or activities
Tangible Objects- Things
that you can touch and feel
Things you can enjoy but can’t physically touch
Trans
portation
• Factors of production Factors of production are the four are the four types of resources needed to types of resources needed to produce the goods and services that produce the goods and services that people need and want.people need and want.– Natural resources- Natural resources- must be scarcemust be scarce• Items provided by nature- farmland, forests, Items provided by nature- farmland, forests,
mineral mines, oil fields, etc. mineral mines, oil fields, etc.
–Human resources- Human resources- • Human effort exerted during production.Human effort exerted during production.
–Capital resources- Capital resources- • Manufactured goods and money used to Manufactured goods and money used to
produce goods.produce goods.– Factories, department stores, machinery, Factories, department stores, machinery,
and tools.and tools.– Improvements in technology help Improvements in technology help
production.production.
– Entrepreneurship-Entrepreneurship-• The starting of a new business or The starting of a new business or
introducing a new product.introducing a new product.
• Entrepreneur-Entrepreneur- the person involved the person involved and taking the risk.and taking the risk.
• These four things add up to produce These four things add up to produce consumer goodsconsumer goods– The goods and services that people buyThe goods and services that people buy
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