CHAPTER 2 NOTES INTRO TO BUSINESS Factors of Production A shortage of resources is called ______________. The means to produce society’s wants and needs are called economic resources, or ____________ ____ ____________. Natural Resources The raw materials found in nature are called ______________ _________________. __________________ resources can be reproduced. __________________ resources are limited and cannot be reproduced. Human Resources The knowledge, efforts, and skills people bring to their work are called human resources, or ____________. Labor can be ___________________ or _______________, physical or intellectual. A big problem facing many nations today is a shortage of ______________ labor. Capital Resources ____________ _____________ are the things used to produce goods and services. Capital Resources include _______________, _________________, and ________________. Entrepreneurial Resources Meeting the changing wants and needs of people requires ______________ _____________. __________________ improve on ways to use resources, or create and produce new ones. Types of Economic Systems _________________ studies how society chooses to use resources to produce and distribute goods and services for people’s consumption. The primary goal of an economic system is to provide people with a minimum ______________ ____ _______________. What are the two basic economic systems? 1. ________________________ 2. ________________________ Market Economy In a ____________________ economy decisions are made in the marketplace. ____________ is the amount of money asked for when goods and services are sold. ____________ is the amount of goods and services that consumers are willing to buy at various prices. The ___________ the price the fewer items people will buy, the __________ the price the more items people will buy. _______________ is the amount of goods and services provided at various prices. When supply and demand meet the price is called the ___________________ price. ______________ or private enterprise resources are privately owned. What two problems with a market economy? 1. 2. Command Economy In a __________________ economy decisions are made by a central authority. In ___________________ the state makes all the economic decisions. In ___________________ there is some form of private enterprise. What is the primary advantage of a command economy? What are two disadvantages to a command economy? 1. 2. Mixed Economy In a mixed economy the ____________ takes care of people’s needs, while the ________________ takes care of people’s wants.