Starter Write and answer the following questions: 1.What is judicial review? 2.What vote is needed to amend the US Constitution? 3.Who appoints and approves federal judges? 4.What is the purpose of the census?

7.1 What are resources and Factors of Production?

Economics The study of how individuals, firms and nations can best allocate their limited resources –In other words, how people can the most of what they want or need from the limited available amount, and at the lowest cost needs- things needed to survive wants- goods one desires and would obtain if they could People make choices on spending their resources to get wants and needs- economics

Resources Things which humans can put to productive use- money, people, time, talents, and natural resources Natural resources- all the raw materials in nature –Renewable: can be replaced over time- timber –Nonrenewable: cannot be replaced- oil

Four Factors of Production Most resources have to be properly processed in order to produce things Four basic factors of production 1.Land- all natural resources involved 2.Labor- contribution of human workers 3.Capital- all structures and equipment 4.Entrepreneurship- creative, managerial, risk-taking in starting a business

Productivity Productivity- The rate at which goods and services can be produced –Key factor in measuring economic growth

7.2 Scarcity The lack of adequate resources to obtain one’s wants and needs Scarcity makes prices go up for consumers (people who buy things) –Producers make or sell items Pricing depends on: –Salaries and wages of workers Goods (material products) Services (activities performed to satisfy wants)

Results of Scarcity People must make choices between two options because of limited resources People are forced to make decisions A trade off is act of giving up one thing of value for another thing of value Opportunity cost- the value of the alternative option that is lost when a decision is made.

Assignment Pick any business that you know. Make a list of the four factors of production involved in running that business. Also, explain how scarcity would affect that business.