INTRO TO BUSINESS CHAPTER 1 ECONOMIC DECISIONS AND SYSTEMS 1-1 1-2 1-3 1-4 Satisfying Wants and Needs Economic Choices Economic Systems Supply and Demand 1-1 SATISFYING NEEDS AND WANTS Needs – Wants – Most products and services you purchase do more than meet your needs. Needs and Wants are __________________. 1-1 SATISFYING NEEDS AND WANTS Goods – Services - Goods and services are consumed by both ____________ and _____________. The U.S. is the largest producer of goods and services in the world. Americans consume more than any other country. 1-1 SATISFYING NEEDS AND WANTS Economic Resources – the means through which good and services are produced; also called _____________ ___ ____________. ___________Resources – raw materials supplied by nature; limited _________ Resources – people who produce goods and services _________ Resources – products and money used in the production of goods and services Note: All economic resources have a _____________ ____________ 1-2 ECONOMIC CHOICES Basic Economic Problem: ____________ Wants and Needs ___________ Economic Resources Scarcity – Scarcity forces you to make ____________ among alternatives. 1-2 ECONOMIC CHOICES Economic Decision-Making – Trade-off – Opportunity Cost – The benefit you get from your choice should be greater than the benefit of the next-best choice. 1-2 ECONOMIC CHOICES The Decision-Making Process 1. 2. 3. 4. 5. 6. 1-3 ECONOMIC SYSTEMS Each __________ must decide how their available resources will be used to meet the needs and wants of their __________. What goods and services will be produced? How will the goods and services be produced? What needs and wants will be satisfied with the goods and services produced? 1-3 ECONOMIC SYSTEMS Economic System – Command Economy – Market Economy – Traditional Economy – Mixed Economy – 1-3 ECONOMIC SYSTEMS U.S. Economic System Capitalism – Based on 4 Basic Principles 1. 2. 3. 4. 1-4 SUPPLY AND DEMAND Consumer – Producers – Producers determine what products and services will be available, the needs and wants they will try to satisfy, and the prices they want to receive. 1-4 SUPPLY AND DEMAND Consumers set Demand – As price increases, demand ___________ Producers establish Supply – As price increases, supply ___________ 1-4 SUPPLY AND DEMAND Determining Price Factors influencing demand: Factors influencing supply: Market Price –