What is economics?
Study of how scarce resources are allocated to competing uses
Scarcity – Not enough to satisfy the needs of everyone
Resource – Something that can be used for production (land, labor, time)
Economic problem example
Should I come to class on the first day?
No: Other things to do, just gonna go over the syllabus. Had to get up, get
ready, get dressed
Why people make the decision they do
Decisions by government
Inflation / Unemployment
Studying decisions by individual firms and consumers
The value of the next best alternative
Costs sleep or free t