Econ 240 1st Edition Lecture 1 Outline of Last Lecture I. 1st Lecture Outline of Current Lecture II. What,How, and for whom?a. What do we produce?a.i. We divide that vast array of goods and services produce into:a.ii. In 2011 the U.S produces:a.iii. In 2011 the top 6 types of services produced: b. How do we produce?b.i. Factors of production are the productive resources used to productive resources used to produce goods and servicesb.ii. Factors of production 4 categories:b.ii.1. Landb.ii.2. Laborb.ii.3. Capitalb.ii.4. Entrepreneurship b.iii. Land b.iv. Laborb.iv.1. Human capital the knowledge and skill that people obtain from education, on the job training and work experienceCurrent LectureWhat, How, and for Whom?- What do we produce?These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute. We divide that vast array of goods and services produce into:▪ Consumption goods and services ▪ Capital goods▪ Government goods and services▪ Export goods and services  In 2011 the U.S produces:▪ 61% on consumption▪ 11% on Capital Goods▪ 11% on Export Goods▪ 17% on Government In 2011 the top 6 types of services produced: ▪ Health ▪ Real Estate▪ Education▪ Retail trades▪ Wholesale trades▪ Transportation and storage - The top Goods produced:1. Construction2. Utilities3. Food 4. ChemicalsHow do we produce?2- Factors of production are the productive resources used to produce goods and services - Factors of production are grouped into 4 categories:◦ Land ◦ Labor ◦ Capital ◦ EntrepreneurshipLand◦ Land includes all the “gifts of nature” that we use to produce goods and services ◦ Land includes all things we call natural resources ◦ Land includes minerals, water, air, plants, animals, birds, and fish as well as farmlandand forestsLabor- The work tie and work effort people devote to producing goods and services- Quality of labor depends on how skilled people are what economists call human capital- Human capital the knowledge and skill that people obtain from education, on the job training and work