SUSTAIN 1S03 Lecture 2: Lecture 2 - Sus 1S03
16 Oct 2018
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Document Summary
Environment was assigned economic value = trillion / year in 1997. Trade-off based on decision to move economy in one direction over another. Specialization can allow an economy to focus in one area to maximize benefit from available resources. Canada has specialized in lumber, oil, gas, mineral extraction. If demand increased and supply does not, then price goes up. If supply increased but demand does not, then price goes down. Equilibrium is at the intersection of the curve. Concept that an individual"s goal is to maximize utility. Utility (in economics) increases with level of consumption. Marginal utility -> increase of utility per unit of consumption. Small change in price leads to a significant change in supply or demand. Significant change in price only creates a marginal change in supply. The role of gov"t is to control areas where the market might fail. Nature does not create waste, everything will be used.
