MATH 133 Study Guide - Midterm Guide: Population Ageing, Opportunity Cost, Transact

• School: McGill University
• Department: Mathematics & Statistics (Sci)
• Course: MATH 133
• Professor: Nagham Sayour

Document Summary

Study of the use of scarce resources to satisfy unlimited human wants. We divide what is produced into goods and services. Factors of production: resources used to produce goods and services; frequently divided into the basic categories of land, labour and capital. Goods: tangible commodities, such as cars or shoes. Services: intangible commodities, such as haircuts or medical care. Production: the act of making goods or services. Consumption: the act of using goods or services to satisfy wants. Scarcity implies that choices must be made, and making choices implies the existence of costs. The cost of using resources for a certain purpose, measured by the benefit given up by not using them in their best alternative use. Every time a choice is made, opportunity costs are incurred. The opportunity cost of using resources fo a certain purpose is the benefit given up by not using them in the best alternative way.