ECO100Y1 Study Guide - Normal Good, Fixed Cost, Marginal Cost
Document Summary
Economics the study of how people make choices under conditions of scarcity and of the results of those choices for society. Scarcity (of resources) a fundamental fact in life. The lack of resources leads to choices and tradeoffs (e. g. catan road or settlement). Macroeconomics the study of the aggregate economy (i. e. it"s the big picture, composed of the sum of all the microeconomies) Microeconomics the study of all the little bits (i. e. it"s whether the farmer will grow bananas or apples, it"s whether the shirts industry will use 80% or 90% cotton, it"s the examination of one individual facet). Opportunity cost the value of the next-best alternative choice/action. (i. e. when making a choice we lose the option of taking the alternative)/ What you give/spend (e. g. spend seeing a movie) Implicit cost what you lose (of your own resources) (e. g. lose 2 hours of time and 10 marks for not studying) Average cost (the total cost/benefit for n things)/n.
