[ECON 208] - Final Exam Guide - Comprehensive Notes for the exam (29 pages long!)

• School: McGill University
• Department: Economics
• Course: ECON 208
• Professor: Mayssun El- Attar Vilalta

Document Summary

Study guide: chapter 1: economic issues and concepts. Economics: the study of the use of scarce resources to satisfy unlimited human wants. The problem of economics: resources are limited, but wants are unlimited. Types of resources: land (raw materials, labour (workers, capital (financial, physical machines and tools) Scarcity implies the need for choice; every choice has an opportunity cost. Opportunity cost: the benefit given up by not using resources in the best alternative way. Direct cost + value of best alternative = oc e. g. oc of university: out of pocket money (,000) + salary (,000) = ,000. Opportunity cost for any activity calculated by 3 things: direct cost of activity, plus, what you give up for the activity, minus, whatever savings the activity generates. Resource allocation determines quantities of various goods produced and how they are distributed. If economy is growing, ppb shifts outwards (graph) Ppb can also stretch vertically/horizontally, depending on variable.