ECONOMICS

 isthe study of efficient allocation of scarce

resources in order to satisfy unlimited
human needs and wants.
 The word Economics came from two Greek
words,
 Oikosmeaning “home” and nomos meaning
“management”
FACTORS OF PRODUCTION
 LAND- is any thing that come from nature and which give life
and support to all living creatures.
 Example: Clean air, Timber resources and Water
 It also refers to immovable properties where industries built
 LABOR-refers to any human effort exerted during the
production process which includes physical exertion,
application of skills or talent or exercise of intellectual faculties.
 CAPITAL-refers to anything that can be used to create or
manufacture goods and services.
 Example: Buildings, Infrastructure, Machines and other tools
used in the production process.
 ENTREPRENEURSHIP-the ability to organize all the
other factors of production in order to carry out effectively the
production process. This skill involves the ability to organize,
take risks, introduce new product and generally create
something of value.
TWO SCOPES OF ECONOMICS
MICROECONOMICS-is the “study of the choices
made by economic actors such as households,
companies, and individuals markets.”
Study the choices of individuals as consumers and
workers. It also studies firms that produce the goods and
services and the industries from which the firms operates
MACROECONOMICS- “examines the behavior of
entire economies”
 Ittackles the aggregates of total values that describe the whole
economy. One very important aggregate is the GDP Gross
Domestic Product.It measures the total output or the
market value of goods and services that a country
produces in one year.
 ADAM SMITH-economic thinkers, and wrote the book
“ An Inquiry into the Nature and Causes of the Wealth of Nations
(1776)
THOMAS MALTUS- wrote An Essay on the Principle of Population
(1798)
DAVID RICARDO wrote Principles of Political Economy and
Taxation(1817)
SEATWORK

HOW DOES SCARCITY AFFECT

YOUR LIFE?