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HUMAN NEEDS AND PRODUCTION - Coggle Diagram
HUMAN NEEDS AND PRODUCTION
purpose of economic activity
meet human material needs
through goods and services
Main economic activities can be classified in three groups
Production
creation of goods and services
Distribution
transport goods from the producer to the consumer
Consumption
based on using the goods and services produced
Economic agents
Households
meet their needs by using the goods and services
Businesses
employ labour to produce goods and services
The goverments
produces and uses goods and services
such as healthcare products to give to public hospitals
and collects taxes fron households and businesses
Factors of production
Resources involved in producing goods and services
Natural resources
raw materials found in nature
used in the consumption/manufracturing of products
and as energy sources
Renewable resources
consumed without being exhausted
they regenerate faster than they are consumed
Some can be almost limitless, such as water and wind
others need a period of time to regenerate, such as flora and fauna
Non- renewable sources
regenerate more slowly than they are consumed
such as, oil, coal and iron ore
Capital
made up of the different elements, involved in the production process
Human labour
workers contribute
Physical capital
raw materials, facilities...
Financial capital
the money needed
Labour
The role is to produce goods or provide services to receive financial compensation
A salary is the payment which employees receive for their labour
Determines the amount of goods they can purchase.