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ECONOMIC ACTIVITY 1 - Coggle Diagram
ECONOMIC ACTIVITY 1
1.HUMAN NEEDS AND PRODUCTION
Economic activity
Production
Creation of good and services: food
Distribution
Transporting goods to the consumer
Consumption
based on using the goods and services produced
Economic agents
Households
People/things that belong to the house
Businesses
labour to produce goods and services
Businesses receive money when the other two agents spend it.
The goverment
Produces and uses goods and services
Also produces goods and services to benefit to general public
Collects Taxes from Households and Businesses
Factors of Production
Natural Resources
Renewable
They are almost ilimitless
Water and wind or (in a period of time) fauna and flora
Non-Renewable
Capacity to renew themselves is low. as a result, they are limitate
Coal, petrol,iron...
Capital
Human
the labour that workers contribute.
Physical
raw materials, facilities, tools and machinery, etc.
Financial
the money needed to pay for physical capital and human capital
Labour
is a concept that includes both physical and intellectual labour.
is to produce goods or provide services to receive financial compensation
salary is the payment which employees receive for their labour and determines the amount of goods
Purchasing power
is the amount of goods or services that an amount of money can buy.
The purchasing power of a wage or salary depends on the cost of living.
