Download What is Economics ANSWERS

What is Economics?
Economics is about how people
choose to use their limited or
scarce resources to satisfy their
unlimited wants (for goods and
services).
How do people
get the
they
&
?
What are the 4 types of
productive resources
(factors of production)?
1.
2.
3.
4.
human resources
capital resources
natural resources
entrepreneurship
AKA labor, skills
AKA tools, capital goods
AKA land, raw materials
AKA risk
What is Economics?
Economics is about how people choose to use their limited or
scarce resources to satisfy their unlimited wants.
Every society has limited
Factors of Production / Productive Resources
human
resources
(labor)
capital
resource
(tools)
natural entrepreneurship
resources
(risk)
(land)
Factors of Production / Productive Resources
human resources
(labor)
capital resource
(tools)
natural
resources (land)
entrepreneurship (risk)
Which are used to produce . . .
Goods + Services = Gross Domestic
(objects) (activities) Product (GDP)
How much can you complete?
Every society has limited
Factors of Production / Productive Resources
human
resources
(labor)
capital
resource
(tools)
natural entrepreneurship
resources
(risk)
(land)
investing increases
GDP & standard of living
WHY?
However, because of scarcity, choices
must be made to answer the
3 basic
questions
..
ONE
What economic
goods & services
will. be
produced?
= Production
TWO
How
will goods & services be
produced?
= Distribution
THREE
Who
will consume the goods
&services?
This creates the need for an
Economic System
Command
(controlled)
Market
(free)
to organize production, distribution,
and consumption.
What is the basic economic problem?
Every society must decide how to
make the best use of its limited
productive resources.
Scarcity, with the resulting need to
choose among competing options,
is the basic economic problem.