1. SSEF1: Scarcity, Resources, Trade-Offs and Opportunity Costs

2. Vocabulary
Scarcity: Unlimited wants for goods and services exceeds the limited resources used to make the goods and services
Resource: any item used to make a good or service
Good: physical item consumers purchase
Service: something someone does for a consumer
Trade-off: choosing between two options
Opportunity Cost: The second best alternative that you give up – your #2 option when you make your choice

3. Rules of scarcity:
Once gone, can not be replaced
Cannot be shared
Must be desirable
PERMANENT

4. Scarcity versus Shortage
NOT THE SAME!!!!
Shortage is temporary and is man made
We will make more of it!!

5. Natural/Land Capital Entrepreneurship Human/Labor Natural/Land Capital
Resources (Factors of Production)
Natural/Land
Capital
Entrepreneurship
Human/Labor
Resources (Factors of Production)
Natural/Land
Capital
Entrepreneurship
Human/Labor
Resources that come from the earth
Physical items made by people that are used to produce other goods / services
People and their physical and mental skills to do a particular job
The ability to create ideas and organize tasks in order to produce a good or service

6. What motivates entrepreneurs?
Profit
Job creation
Innovation
Improving Society

8. Unlimited Wants & Needs
Limited Resources +
Scarcity
Trade-offs
(choices)
Opportunity Costs
(what we give up)

9. An individual decides to pay $8 to see a movie instead of buying an $8 meal. What is the opportunity cost of the movie?
A the satisfaction missed by not eating the
meal
B the $8 paid to see the movie
C the time spent watching the movie
D the satisfaction received by going to the
movie