ECON1131 Chapter Notes - Chapter 1: Opportunity Cost
Document Summary
People"s interest in their material well being attained through the ordinary business of life. Every economic problem has an identical three-part structure consisting of objectives, alternatives, and constraints. Objectives: the part of the economic problem that refers to the goals that economic agents try to achieve. Alternatives: the part of the economic problem that refers to the necessity of making choices: increased choice does not necessarily bring happiness. Law of scarcity: the principle resources are not sufficient to achieve all the objectives, or goals, of an economic problem. Economics: the study of how to best allocate scarce resources: choosing among the best alternatives with the constraints you have to try to achieve various goals, not full definition. The individual, the business firm, and the government. Factors of production: the resources or inputs that producers use to produce goods and services, consisting of labor, capital, land, and material inputs. Labor: different kinds of skills and occupations found in the work force.
