2. WHAT IS ECONOMICS?
Economics is the study of production, distribution, and
consumption of goods and services.
It is the social science that is concerned with the
problem of scarcity
Scarcity =not having enough resources for all of
the wants.*
Economics focuses on how people and societies
decide how to satisfy their unlimited wants, with
our limited resources.
3. RESOURCES
Natural resources (Land)– “free gifts of nature”
Land, minerals, oil, forests, air, and timber
Capital Resources – “manufactured aids to production”
Tools, machines, equipment, factories
Things used in producing goods and services and getting them to consumers.
Human Resources (Labor)– “mankind’s physical and mental
talent”
These are the skills people have that are used to produce goods and
services.
Entrepreneur – the individual who combines the factors of
production in order to produce a good or service.
Risk taker, policy maker, and innovator
4. OPPORTUNITY COST
When decisions are made there is always a cost
involved.
Opportunity Cost= the value of what you must
give up when you make a particular choice.
