Welcome to…
Thinking Like an
Economist!
TRUE OR FALSE?
$
$
$
•Economics is the
study of money.
FALSE!
•Economics is so
much more!!
Economics is the study of…
• How people use resources to
get what they want and need.
Use your Resources!
•People’s wants are
unlimited but
resources are limited.
Limited Resources –
Unlimited Wants
• There are only certain
amounts of resources.
• There is no end to the number
of things people want and
need.
SCARCE – CITY!!
• When people can’t have all the
goods and services they want, a
condition called “scarcity” results.
(What is the base word of scarcity?)
• SCARCITY means there is NOT ENOUGH of the
things that are wanted.
• SCARCITY forces people to make
CHOICES when they produce or
use GOODS AND SERVICES.
$ Opportunity Cost $
• What you give up to get something.
When you make a choice, your
opportunity cost is the second thing
you wanted most.
What Are Our Resources?
• Human Resources - Workers and
their Skills
• Natural Resources – Things in nature
that are useful to people (Gifts of
Nature)
• Capital Resources – Things that are
used to produce more goods and
services. For example: buildings,
factories, tools, machinery.
Economic Activities
• Different ways people use
resources and make goods and
services
• Farming and mining are
economic activities
Producer
• Someone who makes goods or
provides services.
• Factory workers, doctors, and
teachers are producers
Consumer
• Someone who buys goods and
services.
• When you buy something at the
store you are a consumer.
Specialization
• When people produce only some of
the goods and services they
consume.
• Because of specialization, people
must must trade to get the things
they do not produce.
Exchange
• To trade
• People often exchange money for
goods or services
Put on your Economist’s Hat!
• Using your notes, try your hand
at plugging in the words from
the word bank into the correct
boxes on the Important
Economic Concepts Graphic
Organizer – WS.
Human
Natural
Capital
Limited
Resources
Unlimited
Wants
Scarcity
Goods and
Services
Choices
Opportunity
Cost