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2. 2 Resources are used to produce goods and services. Producers of goods and services are influenced by natural, human, and capital resources. How do producers use natural, human, and capital resources to produce goods and services? Terms to know Natural resources : Materials that come from nature (water, soil, wood, coal) Human resources : People working to produce goods and services Capital resources : Goods made by people and used to produce other goods and services (machines, tools, buildings) Producers : People who use resources to make goods and/or provide services Goods : Things that people make or use to satisfy needs and wants Services : Activities that satisfy people’s needs and wants 3. 7 The student will explain how producers use natural resources (water, soil, wood, and coal), human resources (people at work), and capital resources (machines, tools, and buildings) to produce goods and services for consumers.

3. Shirley Wilborne 3 Natural resources Materials that come from nature (water, soil, wood, coal)

4. Shirley Wilborne 4 Human Resources People working to produce goods and services

5. Shirley Wilborne 5 Capital resources Goods made by people and used to produce other goods and services (machines, tools, buildings)

6. Shirley Wilborne 6 Producers People who use resources to make goods and/or provide services

7. Shirley Wilborne 7 Goods Things that people make or use to satisfy needs and wants

8. Shirley Wilborne 8 Services Activities that satisfy people’s needs and wants

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10. 10 We’ve been working on production, All the livelong day. We’ve been working on production, Just to make some goods this way. We use natural resources, Such as land, and oil, and trees. We use capital resources, Such as tools and factories. Now we will work! Now we will work! When we use our human resource. Now we will work! Now we will work! We use our human resource. 14. We’ve Been Working on Production (Tune: I’ve Been Working on the Railroad )

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15. Shirley Wilborne 15 Producers combine natural, human, and capital resources to make goods and services. The amount of each resource the producer uses varies based on the good or service being produced. A producer who combines the resources and takes the risk of starting a new business is called an entrepreneur. To have a successful business, the producer or entrepreneur needs consumers to purchase the goods or services produced.

16. Shirley Wilborne 16 Consumers use goods and services. Producers depend on consumers to use their product and consumers depend on producers to make the goods/services they need and want. This dependency on each other for goods/services is called interdependence. The interdependence that exists between producers and consumers requires that each pay careful attention to the other. Producers must be aware of consumer likes and dislikes to know what to produce, how much of it to produce, and when to produce it. Consumers must understand the difficulties of production and provide good consumer feedback to the producer.

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