1. Opportunity Cost Review
Complete the activity sheet with your elbow partner. Everyone must fill out their own sheet.
After the sheet is complete, on the back, write your own Opportunity Cost Scenario for your partner to answer.
I will choose 5 groups to share there scenarios with the class. One person will read the scenario and the other will give the answers.

2. Warm-up Define Economics. Describe needs and wants.
List the four factors of production.
Give 5 examples for each factor of production.
Which factor of production is the most important? (trick question)

4. Revenue, Profits, and Economic Activity

5. What is Revenue?
Revenue is the amount of money received by a company for goods or services sold during a certain period of time
Goods- tangible items that are bought and consumed; objects
Examples- food, clothing, tools
Services- something that someone does for you; hiring people to perform work for you; actions
Examples- hair cut, car repair, doctor visit

6. Types of Revenue
Total Revenue is number of units sold multiplied by the price per unit
42 units of a product are sold at $2 each, the total revenue is $84
Marginal Revenue is the extra revenue that results from selling one more unit of an output

7. Profit A company’s goal is to make as much profit as possible
Profit is money a company has made after costs have been deducted
Companies can increase profit by maximizing efficiency in production. Often, by adding more land, labor, or capital, companies can increase their profit

8. Cost-Benefit Analysis
Cost-Benefit Analysis- an economic decision making technique that tells us to choose an action or make a decision when the benefits are greater than the costs
Marginal Benefits- the additional satisfaction or benefit when one more unit is produced

9. Diminishing Marginal Benefit
Diminishing Marginal Benefit- the point at which producing more of the product or service is no longer beneficial
Example- Say you have a test and you study for a few hours. After a while you feel like you've covered everything. At that point, there's only so much more benefit you can get from studying more, so you're experiencing diminishing marginal benefit. You already know enough to get a 100, why study more?

10. P 508

11. Economic Activity
Markets- a free and willing exchange of goods and services between buyers and sellers (not necessarily a place)
Factor Markets- markets where productive resources are bought and sold; products used for producing
Product Markets- markets where producers offer goods and services to the consumer