EC120 Lecture 1: Chapter 1
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EC120 Full Course Notes
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The limited nature of society"s resources (water, fossil fuels) The study of how society manages its scarce resources: how people decide. How much to work, save, and spend: how irms decide. A branch of economics to study the behaviour of: consumers, producers. The principles of decision making: people face tradeofs, what you"re doing with your ime now wastes the opportunity of something else you could be doing (ex. People have to weigh the consequences and beneits of their acions (ex. Because raional people respond to costs and beneits, they will react to incenives: incenives are crucial to analyzing how markets work (ex. A bad incenive (indirect efect) would be seat belt law efect as drivers feel that since they are safer in the car, they can drive faster without worrying about the costs of geing injured. Restaurants would not serve food unless they knew customers were going to pay before they leave)
