EC140 Lecture Notes - Lecture 2: Microeconomics, Demand Curve, Opportunity Cost
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EC140 Full Course Notes
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Lesson 1 chapter 2: ppf and key concepts. Required reading: chapter 2, chapter 2 appendix, and lesson notes (done) required work: Economists try to address their subject with a scientist"s objectivity. Two simple economic models are the circular-flow diagram and the production possibilities frontier. Microeconomists study decision making by households and firms and the interaction among households in the marketplace. Macroeconomists study the forces and trends that affect the economy as a whole. A diagram that is a schematic representation of the organization of the economy. A graph that shows the combinations of output that the economy can possibly produce given the available factors of production and the available production technology. E. g. , if an economy uses all of its resources on cars and computers, the ppf displays the various output combinations. Point c is unattainable given the resources, and point d is attainable, but inefficient given the ability to produce more of each good.
