Basic Economic Concepts

Know 3 Economics Questions

Know Factors of Production
Know Basic Economic Vocabulary
 3 Economic
Questions
What to Produce?
How to Produce?
Whom to Produce For?
Factors of Production
Land (Any Natural Resource)
Labor (Workers)
Capital (Money, Machines, Tools)
Entrepreneurship (Starter)
Economic Products
Goods and services that are
useful, scarce, and
transferable

Command a price because

they are scarce
 Services
Worked performed by
someone
–Ex: Home repair, concerts,
haircuts
 Goods
Consumer goods- Goods with final
use by individuals

Capital goods- Goods that are

used to produce other goods
Value and Paradox of
Value
Value- Worth in dollars and
cents
Paradox of Value- Idea that
necessary items may have
very low value while unneeded
items may have high value
 Utility

SATISFACTION
 Wealth
Accumulation of resources and
things that are tangible in the
economy
 Economic Growth

Occurs when nation’s total

output increases over time
 Division of Labor
Divide labor so individual
workers do fewer tasks then
before
Specialization- Workers begin
to do tasks they do more
efficiently
 Scarcity
Created from unlimited wants
and needs and limited
resources
Basic and Biggest Economic
Problem
 DO YOU KNOW?
3 Economics Questions???
4 Factors of Production???
Terms like:
– Scarcity
– Division of Labor
– Economics Growth
– Paradox of Value
– Wealth