Macroeconomics Chapter 1 Notes
-Macroeconomics is the study of the performance of the national economy and the
-Using productive resources that economists call factors of production produces
goods and services.
-Grouped into 4 categories: Land, Labor, Capital, and Entrepreneurship
-Land: Essentially natural resources; minerals, oil, gas, coal, water, air, etc
-Labor: The work time and work effort that people devote to producing goods and
services is called labor.
-Includes physical and mental efforts of all people who work on farms and
construction sites and in factories, shops, and offices.
-Quality of labor depends on human capital, which is the knowledge, and skill that
people obtain from education, training, and experience
-Capital: Tools, instruments, machines, buildings and other constructions that
businesses use to produce goods and services are called capital.
-Entrepreneurship: The human resource that organizes labor, land, and capital is
-People earn their incomes by selling the services of the factors of production they
- (Land = Rent), (Labor = Wages), (Capital = Interest), (Entrepreneurship
-Labor earns the most income
-Self interest vs. Social interest
-Globalization: This means the expansion of international trade, borrowing and
lending, and investment.
-The Information-Age Economy: Also known was the informat