fri factors of production
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Bellringer1. Write a business idea you think might
make you wealthy.2. What specifically would you need to
start this business? (for example, to start a Landscaping company would
need a truck, shovel, and some rocks)3. Think of two reasons most people just
end up getting a job, instead of starting a new business?
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Label Cornell notes
• Factors of production
• “How would I start or expand a business”
Questions or Comments
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Profit Motive• Buy low and sell higher
• People want profits
• Consumer Sovereignty
• Adam Smith “invisible hand”
• Voluntary trade increases wealth
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“Free Market” Economic System• Laissez Faire – French for “leave alone”
• Guided by “invisible hand”
• Stossel clip
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What keeps our economy moving?Circular flow
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New Ideas!Real job creation
• Entrepreneur – French word
• Person who takes a risk to start a new business– OR comes up with a new idea
within a business
Empresario
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Factors of Production• Items we need to be in business
• 3 categories
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Land• Any natural resource
– Rosemont mine example
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Labor• People working
• Wages $
• Benefits
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Sub note to LaborHuman Capital
• Skills, experience, education a person has• It’s the reason doctors are paid more than sandwich
artists
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Capital• Goods used to create other goods/services
• Usually the largest cost for entrepreneurs
• Explanation for “Capitalism”
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New Ideas!Real job creation
• Entrepreneur – French word
• Person who takes a risk combines land, labor and capital to start a new business– OR comes up with a new idea
within a business
Empresario
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Let’s build a new Circle K!
1 Land
2 Labor
3 Capital
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How could your Circle K improve each category?
2 each, specific ideas4 Land
5 Labor
6 Capital
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Group summary• Write 3 “how” or “why” questions
• How does an entrepreneur start a business?