Economics Satisfying Our Needs and Wants

Scarcity

• Goods and services are scarce because we cannot produce enough of them to satisfy everyone’s wants.

Satisfying our Wants and Needs

• Goods – Things we can touch or see that satisfy our wants or needs.

• Services – Actions people undertake in order to satisfy their wants and needs.

Production Resources

Businesses use three types of production

resources to produce goods and services.

Natural

Human

Capital

Natural Resources

• Resources that are present without human interference

• “gifts of nature”

• Examples are land, timber and mineral deposits

Human Resources

• Any human effort used to produce goods and services

• Examples include workers and their skills, training and education

Capital Resources

• Tools of production

• Goods used to produce other goods or services

• Examples include tools, machinery and buildings.

• Money used to purchase these resources is called capital.

Identifying Resources:

NATURAL HUMAN CAPITAL

cotton tractor marketing degree table saws computers

water driver’s license crude oil employees

factory building aluminum electrical license land

Identifying Resources:

NATURAL HUMAN CAPITAL

cotton

water

crude oil

land

marketing degree

driver’s license

employees

electrical license

tractor

table saws

computers

factory building

What is an economy?

• Part I – Introduction

• Part II – Economic Choices

• Part lll – Resources

• Part IV- Capital Resources Link

What is an Economy?

Assignment - Video Voiceover

Create a video voiceover with your partner by creating a script to this video about economics.

Levels of Economic Activity

• Primary – First level

• Secondary – Second level

• Tertiary – Third level

• Quaternary – Fourth level

Primary Activities

• Businesses involved in gathering raw materials.

• Examples include mining and timber companies.

Secondary Activities

• Businesses that add value to materials by changing their form.

• Examples include automobile manufacturers and textile factories.

Tertiary Activities

• Companies that provide business or professional services.

• Examples include salespeople, teachers and doctors.

Quaternary Activities

• Businesses that provide information, management and research services by highly-trained persons.

• Examples include property management or environmental research companies.

Important Note:

The more developed an economy is, the

greater the number and variety of activities

you will find.

Identifying Levels of Activity

_____ Hershey Chocolate _____ Pilot Gas Station

_____ Luck Stone Corp. _____ NTelos

_____ Law Well Drilling Inc. _____ Fry Appraisal Co.

_____Oak Lawn Mausoleum _____ Walmart

_____Augusta Medical Center _____ Hollister

Identifying Levels of Activity

_____ Hershey Chocolate _____ Pilot Gas Station

_____ Luck Stone Corp. _____ NTelos

_____ Law Well Drilling Inc. _____ Fry Appraisal Co.

_____Oak Lawn Mausoleum _____ Walmart

_____Augusta Medical Center _____ Hollister

S T

P T

T Q

T T

ST

Economic Systems

• The way people produce and exchange goods and services is called an economic system.

• Four types of economic systems: traditional, command, market and mixed.

Traditional Economy

Goods and Services are traded without

exchanging money. Also called “barter”.

Market Economy

Production of goods and services is

determined by the demand from consumers.

Command Economy

Production of goods and services is

determined by a central government, which

usually owns the means of production.

Mixed Economy

A combination of command and market

economies provides goods and services so

that all people will benefit.

The End