Chapter 1.1 - Business Activity
Learning Objective: The Purpose of Businesses (1.1)
What do you think is the purpose of businesses?
Business are there to provide us (customers) with goods and services to meet our needs and wants!
Wait, but what are needs and wants?
Let's play a quick game to understand this concept better:
The business activity, therefore, is the process of producing goods and services to satisfy consumer demands!
Another very important concept for us to learn today is the so called economic problem:
In other words, the economic problem is that we have unlimited wants which cannot be met because we have limited resources (a.k.a. factors of production). This problem leads us to scarcity!
What are the resources (factors of production) that are important for business activity?
Since factors of production (resources) are scarce businesses have to make a decision on where to invest their available resources, right?
This is called the opportunity cost:
To summarize, opportunity cost is the benefit that could have been gained from an alternative use of the same resource.
To-Do-List:
Activity 1.3 (p. 12)
Chapter 1.1 - Business Activity
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