SEM I 3.01 Notes Objective: Explain economics and identify basic economic resources. Economics is the study how goods and services are produced deistrubited and consumed_______________________________________ Resources include _all things________used in producing______goods and services _______________ . Economic resources are __the assetts__________________________________that can be used to produce the __goods and services.________________that people consume. __raw materials_____________also known as a natural resource, includes__oil copper coal____and everything contained in the earth or found in the sea.________________________________________________. Labor, __human resources____refers to all workers who work laboring jobs____in the economy______________________, includes all workers in the economy, including _well trained and well qualifed workers__________________________________________ ____________________________________________________________. Capital___resources__includes money to styart and operate a business, as well as goods used in the production of other goods. can be limited because they deteriorate through use or are of poor quality. For example, ________________________________________________. Scarcity is a condition in which more goods and services are desired than are availible._________________________________________________ ______than are available. Scarcity forces ____people busnesses and nations to make choices_____________________ ____________________to make choices. Unlimited wants with limited resources results in _____scarcity____________________. Economic goods are _tangible_____________items. Examples:___cd players____________ ________________ ______sports equipment__________ Economic services are ____intangible_____________. Examples: ________________ ________________ __________________ _______________________incorporates the skills of people who are willing to take the___________________________________________________. Entrepreneurs organize economic ____________________________ ______________________and/or services _________________________in an economy. B. Describe the five economic utilities . Utility is _____________________________________________________________. Five types of economic utility. Form utility is the value added by ________________________________________ _______________more useful. Examples:_____________________ _____________________ __________________ . Place utility is the value added by____________________________________________. Examples: __________________ ____________________________ _______________ Time utility is the value __________________________________________________ or a convenient time of day. Example:______________________________________________________________ . Possession utility is the value added by exchanging_____________________________ ______________ Example:_______________________________________________________________. Information utility is the value added by communicating___________________________. Example: ______________________________________________________________. C. Discuss the three basic economic questions and the role of the government of each system. The three basic economic questions are: What _____goods and services _________________________________should be produced? _______how should__________________________goods and services be produced? ____________for whom____________should the goods and services be produced? In a market economy, there is ______________no government involving in ______________________________the three basic economic questions; the market answers them. Consumers decide what should be________produced___________________________. Businesses decide how_______________to produce goods and services_____________________________. The people who have the money to purchase products_______are able to buy more goods and services____________________ _____________________________. . In a _______command___________economy, the government answers the three basic economic questions. The government officials or leaders decide what should be ___produced and distributed___________. The government runs the________factors of production __________________________________________. The government also decides who will________buy the good and services________________________________. In a traditional economy, the system is based on the ways____cultural or religion practices and ideals.____________________. For example, the __________________________and___________________________. Mixed economies are ___________________________market systems, nor are they completely controlled by_________the government_______________________________. They are a mix, or blend, of the two. All economies presently are________mixed__________________. Capitalism. The people ________and care for those_________________________________who represent their constituents’ interests. For example, the United States and Japan. Socialism. Although most socialist countries are_______________________, the socialist economy has__________________________________________________. The government tries to reduce the differences between the____________________. The socialist model is based on the________________________________________. Examples: _____________________ ___________________ _________________. Communism. Communist countries have a government that is run by_______________ ___________________________________________. People are assigned jobs. ______________________________are told what type of schooling they will receive. Examples: _____________________ ___________________ _________________. . D. Explain supply and demand. Supply is ___________________________________________________________and sell at a ____________________________during a certain period of time. Producers prefer to supply when the price is________________________; this is known as a sellers’ market. Demand is a consumer’s _____________________________________________at a given price during a certain___________________________________. Consumers prefer to buy when the price is_____________________; this is known as a ________________________market. The Law of Supply and Demand is an ________________________________that states the supply of a good or service will __________________________when demand is ___________________________and ________________________ when demand is__________________. Elasticity is the degree to which demand______________________________________ __________________________________________________________________________. Example: __________________________________________________________. Demand__________________________________. Elastic demand refers to how _________________________________________ _________________________________________________demand for that product. Example: __________________________________________________________. Inelastic demand refers to a condition in the market where ____________________ __________________________have very little affect on the ________for that product. Example: __________________________________________________________. Factors that affect the elasticity of demand Availability of substitutes. If a substitute is_____________________________________ ______________________________________________________________________. Example: __________________________________________________________. Example: __________________________________________________________. Example: __________________________________________________________. Brand loyalty. Many customers will only____________________________________. In general, they will accept________________________________________________. In this situation,_________________________________________________________. Example: __________________________________________________________. Example: __________________________________________________________. Price relative to income. When an __________________________________of a good or service does not have a major __________________________________________, the demand is usually______________________________. When an __________________________of a good or service has a major impact on a customer’s budget, the customer___________________________________________. In this case, the demand__________________________________________________. Example: __________________________________________________________. Example: __________________________________________________________. Luxury vs. necessity (want vs. need). When a product is a______________________ ________________________________. When a product is a luxury, demand is most likely to be elastic. Example: __________________________________________________________. Urgency of purchase. If a purchase must be made immediately, demand tends to be _________________________. Example: __________________________________________________________. E. Phases of a business cycle and the impact of each on the sports and entertainment industry. The business cycle is the __________________________________through four recurring phases –_____________________ __________________________ __________________________ _____________________________________.. Explain the phases of a business cycle. I.________________________(Peak) 1.____________________________________ 2. ____________________________________ 3. ____________________________________ 4. ____________________________________ 5. ____________________________________ II. ____________________________________ 1.____________________________________ 2. ____________________________________ 3. ____________________________________ 4. ____________________________________ III. ____________________________________(Trough) 1.____________________________________ 2. ____________________________________ 3. ____________________________________ 4. ____________________________________ IV.__________________________________________ 1.____________________________________ 2. ____________________________________ 3. ____________________________________ 4. ____________________________________ 5. ________________________________________