ECN 104 Lecture Notes - Mira-Bhayandar Municipal Corporation, Capital Good, Opportunity Cost
21 Apr 2012
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Document Summary
Economics is the social science concerned with the efficient use of scarce resources to achieve the maximum satisfaction of economic wants. Ceteris paribus (other things equal): it is assumed that all other variables except those under immediate consideration are held constant for a particular analysis. Microeconomics focuses on the individual parts of the economy. Macroeconomics looks at the economy as a whole. Positive statements are statements that attempt to describe the world as it is. Normative statements are statements about how the world should be: Two fundamental facts together constitute the economic problem and provide foundation for economics: 2 ) the resources for producing goods and services are scarce. Utility: the satisfaction or pleasure a consumer obtains from the consumption of a good or service. Budget line: finite amount of income (let say ) to be distributed over two goods (dvd and book) Economic resources: all natural, human, and manufactured resources that go into production of goods and services.
