Economics is all about making choices and satisfying the needs and wants of consumers
Needs- Things that you need to survive
Wants- Things you think you must have to be satisfied
There are three kinds of economic resources that are used by entrepreneurs to produce goods/services
Natural resources- raw materials supplied by nature are call natural resources. Examples include oil, minerals, and nutrients needed to grow crops and timbers
Human resources- the people who create goods and services are called human resources. They may work in agriculture, manufacturing, distribution, or retail businesses
Capital resources- the assets invested in the production of goods or services are call capital resources. Capital resources include buildings, equipment, and supplies
Role of Entrepreneurs in the US Economy
Entrepreneurs play an important role in the US economy.
They supply almost everything that we use in daily life. Goods and services are all provided by entrepreneurs.
Entrepreneurs also provide capital investment and job creation, which serves as agents for change in the economy
2.2 Economic Decisions
There are four kinds of economic systems
- Command economy- in a command economy, the government determines what, how, and for whom products and services are produced. These types of economies are usually found in dictatorships
- Market economy- in a market economy, individuals and businesses decide what gets produced and for whom they are producing to. This type of economy is usually found in democracies.
- Mixed economy- in a mixed economy, elements from a command economy and a market economy are combines. This is often caused by a countries shift from a command economy to a market economy
- Traditional economy- in a traditional economy, goods and services are produced the way they have always been produced. This type of economy is usually found in underdeveloped countries where industrialization has not taken place.