Economics, Scarcity, and Choice:
Length: 509 words (1.9 pages)
Rating: Red (FREE)
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Economics, Scarcity, and Choice
Economics: is the study of choice under conditions of scarcity
Scarcity: a situation in which the amount of something available is insufficient to satisfy the desire for it.
- time and purchasing power are scarce
As individual?s, we face a scarcity of time and spending power. Given more of either, we could have more of the goods and services that we desire.
Resources: the land, labor, and capital that are used to produce goods and services
- scarce labor
? the time human beings spend producing goods and services capital
? long lasting tools used in producing goods and services physical capital: buildings, machinery, equipment human capital: skills and training workers possess land
? the physical space on which production occurs, and the natural resources that
come with it
As a society, our resources, land, labor, and capital, are insufficient to produce all the goods and services we might desire. In other words, society faces a scarcity of resources.
Raw material ? not long lasting tool Ex. Chalk
What to produce?
How much to produce?
How to produce it?
The World of Economics
Microeconomics: the study of the behavior of individual households, firms, and governments; the Choices they make; and their interaction in specific markets What happens to the cost of movie tickets over the next five years? How many jobs will open up in the fast-food industry?
Macroeconomics: the study of the economy as a whole Lumps all goods and services together and looks at the economy?s total output.
Positive economics: the study of what is, of how the economy works (deals with the facts)
Ex. If we lower income tax rates in the U.S. next year, will the economy grow faster? If so, by how much? What effect will it have on total employment?
Normative economics: the study of what should be; it is used to make value judgments, identify Problems, and prescribe solutions. Normative analysis is based on positive analysis.
Why Study Economics
1. To understand the world better
- understand global and cataclysmic events such as wars, famines, epidemics
- understand local problems; ex. Worsening traffic conditions in the city
- tell us how many skilled therapists, ministers are available to help us
2. To gain self-confidence
- when you master economics, you gain a sense of mastery over the world,
and thus over your own life
3. To achieve social change
- make the world a better place
- help understand stand the origins of problems
4. To help prepare for other careers
- doctors need to understand how newer technology or changes in the structure if HMO?s will affect their practices
5. To become an economist
The Methods of Economics
Model: an abstract representation of reality
A model should as simple as possible and still accomplish its purpose
Simplifying assumption: any assumption that makes a model simpler without affecting any of its.
Important conclusions
Ex. Assume that there are only two goods, two nations
Critical assumption: any assumption that affects the conclusions of a model in an important way.
Ex. We assume that firms will try to earn the highest possible profit
Search for: [middle classes] [countries including] [high level] [women artists]
|
Important Note: If you'd like to save a copy of the
paper on your computer, you can COPY and PASTE it into your word
processor. Please, follow these steps to do that in Windows:
1. Select the text of the paper with the mouse and press Ctrl+C. Azete.com (the "Web Site") is produced by the "Company". The contents of this Web Site, such as text, graphics, images, audio, video and all other material ("Material"), are protected by copyright under both United States and foreign laws. The Company makes no representations about the accuracy, reliability, completeness, or timeliness of the Material or about the results to be obtained from using the Material. You expressly agree that any use of the Material is entirely at your own risk. Most of the Material on the Web Site is provided and maintained by third parties. This third party Material may not be screened by the Company prior to its inclusion on the Web Site. You expressly agree that the Company is not liable or responsible for any defamatory, offensive, or illegal conduct of other subscribers or third parties. The Materials are provided on an as-is basis without warranty express or implied. The Company and its suppliers and affiliates disclaim all warranties, including the warranty of non-infringement of proprietary or third party rights, and the warranty of fitness for a particular purpose. The Company and its suppliers make no warranties as to the accuracy, reliability, completeness, or timeliness of the material, services, text, graphics and links. For a complete statement of the Terms of Service, please see our website. By obtaining these materials you agree to abide by the terms herein, by our Terms of Service as posted on the website and any and all alterations, revisions and amendments thereto. |
put you at ease. Even though traveling can be stressful, it?s worth it once you get where you?re going. Travel could be the answer for one?s problems at work or home. It?s a common way to calm down, breathe easily, and take an easy. People have different ways of relaxing like participating in activi...that these myths must be understood to recognize the source and purpose they serve, and also to know how and why American react to crime Wright offers a challenging new analysis of the misconceptions surrounding crime and an evaluation of the role of the criminal-justice system and the social contex...versation is based between socrates and Meno a young man educated and thirsty of knowledge but very blind folded in the matters of undestanding himself and analizing the nature of things, he is always giving orders in a discussion "as spoiled people do" Is the undestanding of Virtue and 2 ... Throughout time fuel kept on being added to the fire and America found themselves in what is now called World War II. It seems funny to say that the very thing that ended World War I actually caused the second World War. The Treaty Of Versailles marked the end of World War I but not all countrie...