StarterStarter• Write and answer the following

questions:1.What is judicial review?2.What vote is needed to amend the

US Constitution?3.Who appoints and approves federal

judges?4.What is the purpose of the census?

7.1 What are 7.1 What are resources and resources and

Factors of Factors of Production?Production?

EconomicsEconomics• The study of how individuals, firms and

nations can best allocate their limited resources– In other words, how people can the most of

what they want or need from the limited available amount, and at the lowest cost

• needs- things needed to survive• wants- goods one desires and would

obtain if they could• People make choices on spending their

resources to get wants and needs- economics

ResourcesResources• Things which humans can put to

productive use- money, people, time, talents, and natural resources

• Natural resources- all the raw materials in nature– Renewable: can be replaced over time-

timber– Nonrenewable: cannot be replaced- oil

Four Factors of ProductionFour Factors of Production• Most resources have to be properly

processed in order to produce things• Four basic factors of production1. Land- all natural resources involved2. Labor- contribution of human workers3. Capital- all structures and equipment4. Entrepreneurship- creative, managerial,

risk-taking in starting a business

ProductivityProductivity

• Productivity- The rate at which goods and services can be produced– Key factor in measuring economic

growth

7.2 Scarcity7.2 Scarcity• The lack of adequate resources to obtain

one’s wants and needs• Scarcity makes prices go up for consumers

(people who buy things)– Producers make or sell items

• Pricing depends on:– Salaries and wages of workers

• Goods (material products) Services (activities performed to satisfy wants)

Results of ScarcityResults of Scarcity• People must make choices between two

options because of limited resources• People are forced to make decisions• A trade off is act of giving up one thing of

value for another thing of value• Opportunity cost- the value of the

alternative option that is lost when a decision is made.

AssignmentAssignment• Pick any business that you know.• Make a list of the four factors of

production involved in running that business.

• Also, explain how scarcity would affect that business.