Name Hour _____ Date ______ JA Economics Ch.1 pp.1

Name ____________________________________________________ Hour _____ Date _________
JA Economics Ch.1 pp.1-8
1. As you read this section, define each of the following terms in YOUR OWN WORDS
a. Economics
b. Factors of Production
c. Entrepreneurship
d. Scarcity
e. Opportunity Cost
2. Explain the relationship among human needs and wants.
3. Explain the differences among production, distribution and consumption.
4. Why do you think that scarcity is perhaps the single most important economic concept?
5. Use the diagram on p.4 to create your own Want-Satisfaction Chain (example on p.3)
6. Complete the opportunity cost activity on p. 6 below
7. Why is it important to consider benefits and costs when you make an economic decision?
8. Using the 7 key ideas expressed on pp7-8, answer 3 of the “Puzzling Economic questions on p.8.
9. What does it mean to be “thinking at the margin”? Give your own example to show this
Name _________________________________________________ Hour ___ Date _______
Ch. 1 pp.9-14
1. Using the cartoon on p.10, explain how it relates to someone weighing marginal costs versus
marginal benefits.
2. What is profit and how does it act as a motivating factor in the U.S. market economy?
3. How does the market function in our society to give buyers and sellers an environment in
which to exchange goods and services?
4. Describe the ways in which businesses or sellers answer the 3 basic economic questions:
a. What to produce?
b. How to produce?
c. For whom to produce
5. Why would it be important for us to know both about macroeconomics and
Ch. 1 pp.1-9 Key
a. Economics-the science of how individuals and groups decide to use scarce resources
to satisfy their wants
b. Factors of Production-resources needed to produce: land, labor, capital and
c. Entrepreneurship-creative innovation, skills and willingness to take risks that is
necessary to be successful in business
d. Scarcity-the condition that reflects the disparity between wants and resources
available to satisfy those wants
e. Opportunity Cost-the most desirable alternative given up as a result of making an
economic decision or choice