Chapter 1 9/12/2012 1:24:00 PM
Scarcity – our inability to get everythin we want (wanting more than what
we can get).
Incentive – a reward that encourages an action or a penalty that discourages
Economics – social science study, that studies the choices individuals,
businesses, and societies make to cope with scarcity & incentives that
influence the choice(s)
Microeconomics – study that focuses on individual elements of an economy
such as consumers, businesses, labor and government and their role in the
determination of prices for goods and services. (looks at the way individual
markets affect the prices and allocation of resources)
Macroeconomics – the study of total economic activity, not individual
markets, gives an overview of the total economy.
Goods & Servies.
Factors of Productin
- Land: natural resources we use to produces goods and servies [rent]
- Labor: time and effort people devote to producing goods and services
Human Capital: knowledge and skills people attain through education, job
training, and work experience
- Capital: factories, equipment tools, etc used in the production process.