Economics Part 2: Resources/ Producers and Consumers Mrs. Antoine

Economics is about the use of resources.

There are three types of resources. Natural Resources Human Resources Capital Resources

Natural Resources Natural Resources are things found on earth or in nature. People do not make natural resources. People use natural resources to make things. Sometimes natural resources are called “raw materials”. Examples: Land, rocks, water, coal, iron, oil, plants, animals, and sunlight.

Human Resources are the people who work or do labor. People who work may make things or they may help people. A machine is not a human resource. Examples: Teacher, clerks, cowboys, carpenters, doctors, truck drivers.

Capital Resources are made by people and used by people to make other things. They are used over and over without being used up. Examples: Machines, tractors, tools, equipment, factory buildings, computers, cash registers.

Producers Producers are people or companies that make goods or provide services. They sell their goods and services. ( Don’t confuse this with plant producers. Plant producers make their own food.)

Tell if each resource is natural, human, or capital. 1. a forest 2. a shoe store 3. a doctor 4. iron ore 5. a steel mill 6. a river 7 a truck 8. a truck driver

Consumers Consumers are buyers. They spend their money to get things they need or want.

Production Production is the way that goods or services are made. Production makes use of the three resources.

Interdependence is when people or countries depend on each other.

A Toothsome Teaser There once was a little old lady who was out of toothpicks and was in need of some more. Instead of going to the local supermarket, she hired a man to go into the woods and cut down a tree for her. Then she hired a man to come and haul the tree to a sawmill next she hired a man to saw her tree at the sawmill. Then she hired a lady to package the toothpicks into little containers. Lastly, she hired a man to deliver the packages of toothpicks to her house. “What a savings” exclaimed the little old lady. “I didn’t even have to leave the house to get my package of toothpicks.” Who is a producer? Who is a consumer?

Her joy soon turned to concern when the truck pulled up to her door with her toothpicks. Have yo any idea how many packages of toothpicks can be made from one tree? 23,483,989 !!!! The delivery man kept bringing in package after package of toothpicks. It took him 3 days to unload his truck. Meanwhile, the little old lady was running out of room in her tiny little house. Her kitchen was so filled up that you couldn’t even find the sink? The phone rang, but the little old lady searched in vain to locate it. She tried to find her bed to lie down, but, alas, it was nowhere in sight. “Oh, my,” said the little old lady. “what am I to do with all these toothpicks?” Who is a producer? Who is a consumer?

Because she couldn’t find her phone to get some assistance, she hired a neighbor to make a huge sign over her garage advertising for someone to come up with an idea for her situation. Next she paid a woman who gaver her the idea to sell the extra 23,483,988 toothpick packages. Then she hired a man to build a place to store her toothpicks. She paid a woman for advertising the sale of the toothpicks. Then the little old woman hired a salesman to sell her toothpicks. Who is a producer? Who is a consumer?