1. Describe what
you see. Be as
specific as
possible.
2. Identify the
what message
the cartoon is
demonstrating.
3. Predict what
will happen if
nobody gets
what they
want.
Opening Activity #2
Scarcity and the Factors of
Production
What is a need?
• a necessity, required for survival, or something
you can’t go without
– Example: air, food and water, shelter, clothing
What is a want?
• An item that we desire but that is not
essential to survival, luxuries
– Example: VW Bus, season seats, iPhone 5
Needs vs. Wants
Write-Pair-Share
• List the needs you have.
• List 5 specific wants you have.
What is the difference between a
good and a service?
• A good is a physical object
– Example: clothing, iPod
• A service is an action or activity that one
person performs for another
– Example: haircut, babysitting
Think-pair-share
• You want to buy a house. You hire a real estate
agent to help you find a home. After showing
you different homes, you finally decide on a
home in Redondo Beach and buy it.
Identify what the good is and what the
service is.
What is “economics”?
• Economics is the social science that studies
how individuals, businesses, and societies
seek to satisfy their needs and wants by
making optimal choices under conditions of
scarcity
What is scarcity?
• Limited amount of resources to meet
unlimited wants
– Example: I can’t buy an endless supply of VW
buses
• Scarcity always exists because our wants and
needs are always greater than the resource
supply
Ticket out the Door
1. Summarize the definition of “economics” in
your own words.
2. Explain why people make choices.
Opening Activity #3
1. What was the last good or service you
received for free?
2. How or why did you get this for free?
3. Think critically. Explain why this good or
service was not really free?
Partner Challenge
1. List everything that went into the making of
In ‘n Out fries from the time it was thought of
until the time it was purchased by a
consumer.
Football
1. What is a need? What are all 5 needs?
2. What is a want? Example?
3. What is a good? Example?
4. What is a service? Example?
5. What is economics the study of?
6. What is scarcity?
7. Why is Adam Smith important?
8. What types of incentives are there?
9. Tell me something about incentives.
10. Pair/Share: “There’s no such thing as a free
What are economic resources?
• All natural, human, and manufactured
resources that goes into the production of
goods and services
• Resources that make goods and services are
called the factors of production
• Factors of production are
– Land, labor, capital, and entrepreneurship
Land
• Land: the natural resources that are used to
make goods and services
– Example: fertile land, coal, water, forests
Labor
• Labor is the work people do for pay
– Example: artist painting, chef, mechanic
Capital
• Capital is any human made resource that is
used to create other goods and services
– 2 types to produce goods and services
1. Physical capital
2. Human capital
Physical capital
• Physical capital are all human made goods
that are used to produce other goods and
services
– Example: machines, tools, buildings
Human capital
• Human capital: the knowledge and skills a
worker gains through education and
experience
– Example: vets use training from school; coaches
use training
Who pulls these resources
together?
• Entrepreneurs are people who combine land,
labor, and capital to create new goods and
services
• Example: Bill Gates, Oprah, Mark Zuckerberg
Quick Search Challenge
1. What is this entrepreneur’s famous
accomplishment?
2. Identify the factors of production (land, labor, and
capital) that this entrepreneur used.
3. How was this person able to arrange the factors of
production to make a successful business?
4. What risks did this entrepreneur take? What was
his or her reward?
Last note on scarcity…
• Goods and services are scarce b/c the land,
labor, and capital used to create them are
scarce
– Example: In ‘N Out fries
Summary
1. In your own words: Economics is _________
2. The factors of production include _________
3. Explain how scarcity and economic resources
relate to one another.
Factors Chart
1. In groups of 4, you will choose one good to sell
2. On your paper, you will:
1. Include your product name
2. Names of the entrepreneurs
3. An illustration of your product
4. brief, 3-5 sentence company description answering the
following: what is your product? What is unique about it? Why
are you selling it? Who are the owners? Who are the customers
you are trying to target?
5. A 3-column chart showing 15 factors used to produce your good,
each factor should have at least 3 factors represented; also, at
least 5 of the factors need to be drawn, not written
Opening Activity
• Your favorite band is in town and you want to
go, but the tickets are $50. You could buy the
ticket, or you could
– Use the money to see 5 movies
– Buy a pair of jeans
– Save the money for vacation
• What do you choose? Why?
• List 3 other things you could use the money
for.