Ch.+1+HW


 * 1.1 Notes & Questions #1-6**

1. A good is something that can be used such as clothing or food, a service is something that is done for you such as haircuts, preparations of food ect. 2. Scarcity is a starting point for thinking economically because one has to think about all the resources that are being used and their availability 3. Scarcity is when something is limited in quantity and can run out such as oil and a shortage is when a producer cannot offer things at its previous price. 4. Land is used for all the natural resources we use, labor is when someone works for a sum of money to make products, and capital are machines or anything human-made to produce goods or services 5. Physical capital offers special advantages by saving companies time and money because of human-made objects used to make goods and services 6. Entrepreneurs play the role of fueling the economy and creating new industries with the businesses they start at their own risks.
 * Scarcity & Choice**
 * People cannot have everything that they need and want
 * **Need** is something that is necessary for survival
 * **Want** is something one desires but is not necessary to survive
 * People need to make choices based upon which thing will fulfill their needs best
 * Economics is the study of how people seek to satisfy their needs and wants by making choices
 * Scarcity**
 * When living in a relatively wealthy country, such as the U.S., scarcity is not a concept much think about
 * **Goods** are physical objects such as shoes and shirts
 * **Services** are actions or activities that one person performs for another (haircuts, dental, tutoring)
 * Defining Scarcity**
 * **Scarcity** implies limited quantity of resources to meet unlimited wants
 * while one may be able to buy hundreds of a product, no one can have endless supply of everything
 * at one point or another a limit will be reached, the core of economics is about solving the problem of scarcity
 * Scarcity v.s. Shortages**
 * Scarcity is not the same as a shortage, a **shortage** occurs when producers will not or cannot offer goods or services at the current price
 * Shortages can be temporary or long-term, wars and droughts can create shortages that last for many years
 * Scarcity, in contrast, always exists because there will always be a need and want greater than our resource supply
 * Land**
 * Economists use the term **factors of production** for resources used to make all the goods and services
 * Factors of production are land, labor, and capital
 * They use the term **land** to refer to all natural resources used to produces goods and services
 * Labor**
 * Another essential of factor of production is **labor**, labor is the effort that a person devotes to a task for which that person is paid
 * Capital**
 * **Capital** is any human-made resource that is used to produce other goods and services, two types of capital are physical capital and human capital
 * Physical Capital**
 * **Physical Capital** is when human-made objects are used to create other goods and services
 * examples of physical capital are: Buildings, pencils, conveyer belts,
 * All these are important factors of productions because it can save people and companies a lot of time and money
 * Human Capital**
 * Along with the productions of physical capital, people can invest in themselves
 * **Human Capital** is the knowledge and skills a worker gains through educations and experience
 * An economy needs both human and physical capitals to produce goods and services (doctors use school and use stethoscopes
 * Entrepreneurs**
 * Who pulls all these essential ingredients together? **Entrepreneurs,** entrepreneurs are ambitious leaders who decide how to combine land, labor, and capital resources to create new goods and services
 * They are individuals that take risks to develop original ideas, start businesses, create new industries and fuel economic growth
 * Questions**