What is economics?
The study of how people choose to use their limited resources in order to satisfy their limited wants.
What are resources?
Things used to produce goods and services
what do we call this kind of situation?
limited resources: | <—-> |
unlimited wants: -inf. <—–> +inf.
scarcity
What is scarcity?
The situation that exists when resources are inadequate to produce all the goods and services that people want. Because of the problem of scarcity people have to
make choices.
In economics we often use economic models. what is it?
A simplified version of economic reality.
In economics, what are assumptions?
They are required conditions under which a model works
what is one of the most used assumptions in economics? What does this assumption allow us to study?
-“ceteris paribus” or in English “other things being equal”.
- allows us to study the effects of 1 variable while assuming that other remain constant.
What is an example of the use of “ceteris paribus”?
“if I eat junk food, ceteris paribus, I will gain weight.” so if I eat more junk good and I change nothing else in my habits I will gain weight> if “ceteris paribus” is not present then this statement might not be true as I could do more exercise yo prevent weight gain too.
What are the 3 main branches of economics?
microeconomics, macroeconomics and (econometrics)
What is microeconomics?
the branch of economics that studies the behaviour of individual economics units
what is macroeconomics?
the branch of economics that studies the behaviour of the economy as a whole
What are products?
what people consume
What are goods?
tangible products (ex: tablets, cheese, pens, etc)
What are services?
intangible products (ex: teaching, banking, etc)
What are producers?
people who sell and produce a product
What is a industry?
a group of producers who make and sell a similar product (the industry is named by its main product) ex: beer and ice cream industry
What are consumers?
people who purchase products for personal use
What are resources (or inputs or factors of production)?
things used to produce goods and services
what are the 4 factors of production?
land: nature (ex:land, oil,wood..)
labour: mental and physical efforts (ex:psychologist services or doctor..)
capital: produced means of production (ex:equipment, machinery, roads..)
entrepreneurship: ability and talent to organize resources
What are variables?
anything that changes (ex:temp., income, etc)
What is a constant?
anything that remains unchanged (ex: pie, 6, ..)
What is a function?
an expression of a relation among variables (ex:3x + 5)
what is a slope?
steepness or flatness of a live ( ‘triangle’ y/’triangle’ x)
how do we find point when we have a function?
we create a table and then later graph it (only need 2 points for a linear graph) so we plug in different numbers as x so 0, 1, 2, 3, …
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introduction : basics31
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The PPF, the simple circular flow model and economic systems43
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Supply and demand (part 1)20
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supply and demand (part 2)20
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unemployment, inflation and interest rates43
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personal finance1
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the gross domestic product34
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real GDP, economic fluctuations and the budget balance34
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Money and Banking41
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aggregate supply and aggregate demand38
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monetary and fiscal policy34
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International trade12
