Economics: Factors of Production and Opportunity Costs

Identify which category - land (renewable or nonrenewable), labor, capital, or entrepreneurship - each items falls into.

Groups:

(a) Land

,

(b) Labor

,

(c) Capital

,

(d) Entrepreneurship

• Creators of Instragram

• Cows

• Tractor

• Chef

• Steve Jobs

• Accountant

• Copper

• Cash Register

• Elon Musk's SpaceX

• Teacher

• Hammer

• Copier Machine

• Microphone

• Coal

• Spring Water

• Engineer

You decide to order a pizza to satisfy your wants. First, you picked up the telephone and gave your order to (1) the owner that entered it into her (2) computer. The (3) manager in the (4) kitchen assigned it to one of his (5) cooks. The cook used his (6) knowledge of mixing dough out of (7) salt, flour (wheat), eggs (chickens), and milk (cows). The cook finished mixing dough, washed his hands in the (8) sink, and prepared your pizza using (9) tomato sauce (tomatoes), cheese (cows), and sausage (pigs). He then placed the pizza in the (10) oven. Within 15 minutes the pizza was cooked and placed in a (11) cardboard box. The (12) delivery person then grabbed your pizza, jumped in the (13) company car, and delivered it to your door. You opened the door and paid for the pizza with (14) cash and gave the delivery person a nice $5 tip for his troubles!

Groups:

(a) LAND

,

(b) LABOR

,

(c) CAPITAL

,

(d) ENTREPRENEURSHIP

• oven

• kitchen

• cooks

• delivery person 

• the owner

• computer

• sink

• cardboard box

• tomato sauce (tomatoes), cheese (cows), and sausage (pigs)

• cash

• knowledge of mixing dough

• salt, flour (wheat), eggs (chickens), and milk

• manager

• company car

List 5 things you could do on a Saturday afternoon. 

Now, out of that list of five items, choose the top 2 that you would really like to do. 

What would be the activity you would actually do? __________________________

(This is your your choice; your benefit.)

Which one would you be giving up doing? ___________________________

(That is your opportunity cost- the next best alternative; what you gave up.)