1. Explain the difference between "Land" and „Capital".
2. Explain the difference between a laborer and an entrepreneur.
3. Explain the difference between a "consumer" good and a "capital" good.
Vocabulary: Test your comprehension of key economic terms used throughout the course by completing the following sentence frames using the terms listed below.
Capital Goods Inputs Production
Consumer Goods Outputs Services
Entrepreneurship Labor
Factors of Production Land
1. The resource needed to organize the other factors of production is called ___________________.
2. The workers needed to operate an assembly line at a computer manufacturing plant care considered ________________.
3. The ________________________________ are the resources used to produce goods and services
4. The _____________________ process transforms the factors of production into the goods and services we use and consume
5. The _____________________ process is how humans transform their environment to suit their daily wants and needs
6. The entertainment you pay for when you go to a movie is intangible, therefore the movie theater is providing a __________________.
7. A ______________________ good is something to be used in the production of another good or service.
8. Goods such as clothing and iPods which we buy to improve our quality of life are called ____________________ goods.
9. "Factors of production" is the economic term for the __________________ to the production process.
10. The ___________________ of the production process include consumer goods, capital goods, as well as services
Classifying the Factors of Production: In this section, you will be given various factors of production. Determine which of the four factors of production each one belongs to and write it in the space provided. The four types of factors of production are:
Land Capital (the material resources)
Labor Entrepreneurship (the human resources)
1. _____________________ The clerk at your local grocery store.
2. _____________________ Bill Gates, the founder of Microsoft
3. _____________________ The 500 acres of land which Dodger Stadium sits on.
4. _____________________ Mechanics providing oil changes at car dealership.
5. _____________________ The computers needed to organize the payroll for Wal-Mart.
6. _____________________ The tractor a soy bean farmer used to harvest his crops
7. _____________________ The single mother who operates her own online E-Bay business
8. _____________________ The cook flipping burgers at McDonalds
9. _____________________ The airplanes produced by Boeing used for commercial air travel.
10. _____________________ The building where the Home Depot operates
11. _____________________ The raw coal used to power blast furnaces at a steel foundry
12. _____________________ The little girl selling lemonade on the corner to earn some extra summer cash
13. _____________________ The phone operator giving you technical support for computer software
14. _____________________ The processing chips needed to make smart phones
15. _____________________ Thomas Edison who marketed electricity to the general public
16. _____________________ The guy at city hall operating his own hot dog cart
17. _____________________ The maid you hire to clean your house from the local maid service
18. _____________________ The woman who decided to spend her savings and open up her own restaurant
19. _____________________ The ovens needed to cook your food at your favorite restaurant
20. _____________________ The oil deposits off the Gulf Coast needed to produce plastics for consumer use.
Section 4 - Classifying Output: There are three types of output businesses produce. Classify each of the following outputs as either a consumer good, a capital good, or a service.
Consumer Good - A good intended for final use
Capital Good - A good intended to be used in the production of another product.
Service - An intangible product. A job or skill provided for payment.
1. _____________________ A leather jacket sold at Macy?s
2. _____________________ A bulldozer sold by CAT to a land developer to grade land
3. _____________________ The plumber unstopping a clogged drain
4. _____________________ A haircut from Supercuts
5. _____________________ A San Diego Chargers football game
6. _____________________ A plane bought by southwest to add to its commercial fleet
7. _____________________ The small private jet used by a movie star to go from party to party
8. _____________________ The hamburger you eat for lunch
9. _____________________ A uniform made by a uniform company used by UPS to clothe their drivers.
10. _____________________ Gasoline used to go a family vacation to Florida
11. _____________________ Gasoline used by the UPS driver to deliver packages
12. _____________________ The drill produced by black and decker bought as a father?s day gift.
13. _____________________ The drill purchased by a contractor needed to build a cabinet for a new home.
14. _____________________ Movie tickets bought at your local movie theater
15. _____________________ A financial advisor providing retirement advice
16. _____________________ The glass company who produces windshields for new cars
17. _____________________ An iPod bought as a Christmas present for your cousin
18. _____________________ An accountant who does personal income tax returns.
19. _____________________ The ovens needed to cook your food at your favorite restaurant
20. _____________________ The groceries purchased to feed your family.
Section 1 - Short Essay Questions: Please answer the questions using the lines provided. Please use complete sentences and answer each question completely.
1. How can an economy attain a combination of output beyond its production possibilities?
2. Give two reasons why economic growth occurs.