RSM100Y1 Lecture Notes - Lecture 1: Opportunity Cost, Capitalism
Document Summary
Foundation document for capitalism, free enterprise, free trade, wealth creation. Capitalism: a legal system that safeguards private property and permits free trade in competitive markets; production and consumption are not controlled. money: a way to count a store of value. Of the real and nominal price of commodities, or of their price in labour, and their price in money. Real price: the toil and trouble to acquire everything (time, efforts spent) the value of the time and efforts can worth certain amount of money (opportunity cost) Of the component parts of the price of commodities . Of the natural and market price of commodities . Actual price may be above or below the market price, different price produce their own markets. market price is not human made by agreement. Invisible hand of self interest motivates individuals to work hard so free enterprise will maximize productivity rrrrall economic are based on assumptions.
