Ch 1 - Scarcity Factors of Production.ppt

economics lesson - factor of production

1. SCARCITY & FACTORS
OF PRODUCTION

2. Students will demonstrate an understanding of the four factors of
production by identifying factors in a fictitious business
Students will define the word scarcity as an exit ticket
Students will demonstrate an understanding of how scarcity and
the FOP are linked by completing an assessment on page 8-9 in
their textbook
OBJECTIVES

3. What is an example of a “need”?
Something that is absolutely essential for you to survive
Water
Money
House
What is an example of a “want”?
Something that is superfluous (means extra!) to your needs. You do
not need these things to survive.
Pizza
A mansion
Abercrombie hoodie
NEEDS VS. WANTS

4. IDENTIFY:

5. How would you explain the difference between goods and
services?
Goods: Tangible items you can hold in your hand
Services: Things that you pay someone to do for you
GOODS VS. SERVICES

6. WHICH ONES ARE WHICH?

7. Limited quantities of resources to meet unlimited wants
SCARCITY

8. What is scarcity?
Limited quantities of resources to meet unlimited needs!!
CFU

9. Factors of production + scarcity = economics
Economics: The study of scarcity and how
scarcity affects the world around us
FACTORS OF PRODUCTION

10. Land
Labor
Capital (human, physical, financial)
Entrepreneur
FACTORS OF PRODUCTION

11. Land: all natural resources. Key = NATURAL
Labor: Physical actions performed that require no specialized
knowledge or upper level education
Entrepreneur: Someone who combines the factors of production
to create a business.
FACTORS OF PRODUCTION

12. Financial capital = cash money!! You need money to start a
business!
Human capital = knowledge and skills a worker gains through
education and experience
Physical capital = The “stuff” you need to build a business
(building, tools, etc….)
TYPES OF CAPITAL

13. An office building?
Physical capital
An assembly line worker?
Labor
A tree used to make paper?
Land
Unused soil?
Land
An artist?
Human capital
A business owner?
Entrepreneur
WHICH FOP?

14. You wanna start a business that specializes in writing research
papers for other students. Identify something for each of the five
factors of production that you will need in order to successfully
get this off the ground….
SOOOOO…..

15. Factors of production:
Land
Where will this business be located? Your house? Will you buy a store
front building?
Labor
Who will be physically typing the papers? You? Hiring workers?
Capital
What types of skill sets will you (or your workers) be required to have
(Human capital)? What tools will you need to be successful in this
business? How much money to get started?
Entrepreneur
You!
Add that with scarcity (people have scarce time and money, not many
competitors) and you will have a successful business
PAPER WRITING BUSINESS…

16. On your whiteboard:
Define Scarcity
List the factors of production
EXIT TICKET

17. Identify an example of each of the five factors of production for
the Subway in Windsor
HOMEWORK