ECON 102 Lecture Notes - Lecture 1: Marginal Cost, Opportunity Cost, Online Shopping
1
ECON 102 Full Course Notes
Verified Note
1 document
Document Summary
Economics: the study of how society manages its scarce resources. How people decide what to work, buy, save. How firms decide to produce, how many workers. How society decides to divide resources between consumer goods, environment, other needs. Seller (buyer) main goal is to maximize profit. In general, society"s main goal is to maximize social (economic) welfare. Roles: -buyer (consumer) main goal is to maximize utility. People face tradeoffs: all decisions involve trade offs. Ex: going to a party the night before exam leaves no room for studying. Ex: working more so more money to buy stuff but less time for leisure national defense of consumer goods. Suns vs. butter : society faces an important trade off efficiency vs. equality. Efficiency: when society gets the most from its scarce resources: higher incentive to work income gap gets better. Equality: when prosperity is distributed uniformly among society"s members: income incentive to work harder.
