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Consumer and Producer Lesson

This lesson explores the distinction between necessities and wants in economics. It highlights how all necessities are considered wants, but not all wants are necessities. People have unlimited wants, which include both basic needs like food, shelter, and clothing, and luxuries that are not essential for survival. The concept of incentives, both positive and negative, plays a crucial role in motivating consumer behavior and producer responses in the marketplace. The lesson also discusses how individual necessities may change over time and the dynamics between consumers and producers.

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Consumer and Producer Lesson

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  1. Consumer and Producer Lesson All necessities are wants, but not all wants are necessities.

  2. People have unlimited wants. • Wants are human desires for material goods or services.

  3. People’s desire for love, peace and fulfillment are separate!

  4. Wants are divided based upon their incentive…. • Basic necessities are food, water, shelter, clothing and air; all necessary to survive. • A person desires a Luxury, but doesn’t need it to survive.

  5. Why is incentive important in economics? • Incentive is the factor that motivates a person to take action. • Positive incentive. • Negative incentive is called a disincentive. • Government officials try to encourage people to do some acts; discourage others. • Business owners try to encourage people to buy products by giving incentives.

  6. Could a person’s necessities change over time? • Older people often need _?_ to survive? • Do these items become a necessity for them?

  7. People’s wants and needs to consume create producers and service providers.

  8. Producers and service providers within Westmoreland County sell products or services to meet consumer demand.

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