Human wants | Business Studies Form 1

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Human wants - Business Studies Form 1


Satisfaction of human wants
By the end of the topic, you should be able to:
(a) explain the meaning and characteristics of human wants
(b) classify human wants


(c) explain the meaning of goods and services

(d)discuss characteristics of goods and services
(e) explain the meaning and characteristics of economic resources


(f) relate the concept of scarcity, choice and opportunity cost to real life situations


SATISFACTION OF HUMAN WANTS 
Objectives
By the end of this topic you should be able to;
(a) explain the meaning and characteristics of human wants
(b) classify human wants.
(c) explain the meaning of goods and service

(d)discuss the characteristics of goods and services.

(e) explain the meaning and characteristics of economic resources
(f ) relate the concept of scarcity, choice and opportunity cost to real life situation




Human wants  for survival   for comfort
Food
Radio
Shelter
Education
Clothing
Newspaper
Medical care
A car


Meaning of goods and services
Human wants are satisfied by goods and services

Goods are physical commodities that one can see or touch e.g. furniture or food.

Services are intangible activities that one cannot see but satisfies human wants e.g. teaching, banking.

Meaning of human wants
Human wants are needs, requirements and desires that people have.

Human beings have many wants .Examples of these desires are food, shelter, clothing. entertainment, education and medical care among many others.

Types of human wants
 

Basic wants
These are necessities that are absolutely vital for human survival. That is, without them human beings will die. For example food, shelter and clothing. Basic wants are also referred to as primary wants.
 

Secondary wants

These are requirements which one can do without but their fulfillment can make life more comfortable. For example a car, radio and a newspaper etc

Meaning of goods and services

Human wants are satisfied by goods and services.

Goods are physical commodities that one can see or touch e.g furniture or food.

Services are intangible activities that one cannot see but satisfies human wants e.g teaching, banking, preaching etc.


CHARACTERISTICS OF GOODS

-They are tangible

-They can be stored

-They can be standardized.

-They can be seperated from the producer

CHARACTERISTICS OF SERVICES

-They are intangible

-They cannot be stored

-They cannot be standardized

-They are inseparable from the producer

SCARCITY CHOICE AND OPPORTUNITY COST

Human wants are unlimited while resources required to satisfy them are limited (scarce). Therefore man has to make a choice of what want to satisfy first with available resources. The order in which wants are to be satisfied is known as the scale of preferences.

To satisfy wants, some wants have to be sacrificed or foregone. The alternative wants or the benefits foregone is called opportunity cost.

Example:

Mary had sh 25 with which to buy either a pen or a loaf of bread.If she buys a pen,the loaf of bread will be foregone .The loaf of bread is the opportunity cost.

Characteristics of human wants

The following are the main characteristics of human wants

(a) Human wants are unlimited: This means that there are too many wants to be satisfied by our limited resources


(b) They are competitive:
Due to limited resources the satisfaction of one competes with the satisfaction of the other wants, hence the most important wants are satisfied first.


(c) They are complimentary: Satisfaction of one want gives rise to another want. For example when a student acquires a fountain pen; the need for ink arises.

(d) They are repetitive (recurrent):
This means that after they have been satisfied once, the wants recur thereby creating the need to satisfy them again. For example, after taking breakfast,one needs to take lunch, supper and breakfast again.

(e) They are habit forming:
This means that by using them you become a habitual user. For example, frequent use of tea makes one a habitual tea taker.

(f) They vary in urgency and intensity:
For example, in January, the need to pay school fees and buy school uniform is more urgent and intense than buying a pair of jeans.

g) They are universal:
This means they are required by everyone in the world.

Characteristics of goods

  1. They are tangible.
  2. They can be stored.
  3. They can be standardized..
  4. They can be separated from the producer.

Characteristics of services

  1. They are intangible.
  2. They cannot be stored.
  3. They cannot be standardized.
  4. They are inseparable from the producer.

Economic Resources
Economic resources refer to things that are required to produce goods and services to satisfy human wants.
Example includes land, machinery, tools and labourers.
Characteristics of economic resources

Scarce

They are limited in supply in relation to the total wants which they have to satisfy.
Monetary value
.
They are valued in terms of money and therefore a price has to be paid in order to obtain them.
Unevenly distributed
.
They are not found everywhere and are also not found in equal amounts on the earth's

surface .

Have alternative uses
.
That is a choice has to be made as to which use they will be put to.
Have utility
.
This is the ability of being useful or satisfying human wants.
They are transferable
.
Some can be transferred from one person to another
.

Scarcity

means that goods and services are limited in supply in relation to demand for them.

Choice

Scarcity of economic resources makes choice necessary regarding what want to satisfy first with available resources. This is done with a scale of preference. A scale of preference is the order in which wants are to be satisfied starting with the most pressing wants and ending with the least pressing wants

Opportunity cost
Satisfaction of wants involves sacrifice. Opportunity cost is the alternative foregone in order to enjoy another good or service.
Example

Mary had kshs.25 with which to buy either a pen or a loaf of bread. If she buys a pen, the loaf of bread is the opportunity cost.

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