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Intro To Econ Notes

This document provides an introduction to key economic concepts in 3 sections: [1] It defines economics as the study of how resources are allocated to meet individual, government, and firm needs within an economy. It also distinguishes between microeconomics which examines individuals and firms, and macroeconomics which examines the overall economy. [2] It outlines economic methodology including positive economics which makes factual statements and normative economics which considers subjective opinions. It also defines scarcity, efficiency, choice, and intervention. [3] It describes the basic economic problem of allocating scarce resources to meet unlimited wants, and factors of production including land, labor, capital and enterprise. It also summarizes production possibility curves

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Lea Bondoc Lim
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85 views1 page

Intro To Econ Notes

This document provides an introduction to key economic concepts in 3 sections: [1] It defines economics as the study of how resources are allocated to meet individual, government, and firm needs within an economy. It also distinguishes between microeconomics which examines individuals and firms, and macroeconomics which examines the overall economy. [2] It outlines economic methodology including positive economics which makes factual statements and normative economics which considers subjective opinions. It also defines scarcity, efficiency, choice, and intervention. [3] It describes the basic economic problem of allocating scarce resources to meet unlimited wants, and factors of production including land, labor, capital and enterprise. It also summarizes production possibility curves

Uploaded by

Lea Bondoc Lim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Introduction to economics Cheat Sheet

by egomezc via cheatography.com/146282/cs/31605/

Economics as a social science Economic method​ology (cont) Economic problem (problem of choice)

Economics is the study of how resources positive economics: the study of economics Basic economic problem : how best to
are allocated to meet the needs and wants that is provable, that is factual statements allocate scarce resources to meet the
of indivi​duals, govern​ments and firms within about the economy or statements of “what unlimited wants and needs of indivi​duals
an economy is” rather than “what ought to be”
Economics is considered a social science normative economics: Normative Factors of production
since it examines the diverse social economics considers peoples varying Land: The natural resources used in
behaviour of indivi​duals and societies in opinions and beliefs about what should be. production
relation to the allocation of scarce resources These claims are subjective and expressed
Labour: The human resources required for
Microe​con​omics : concerned with the as value judgements
the production process
behaviour of indivi​duals and firms
Capital: Non-na​tural products used in the
Nine central concepts
Macroe​con​omics : examines the operations production process, such as machinery
of the economy as a whole Wellbeing
Enterprise: The skills, creativity and risk-t​‐
Interde​pen​dence aking ability that a business person requires
Scarcity
Scarcity to succes​sfully combine and manage the
Scarcity refers to the idea of finite resources Efficiency other factors of production
of an economy relative to the unlimited
Choice
needs and wants of indivi​duals and Basic economic questions
Interve​ntion
societies. Therefore, scarcity means that
What to produce?
there is a shortage of resources in the Change
Why to produce?
economy at any moment in time. Equity
For whom to produce?
Sustain​ability
Production possib​ility curves
Circular flow of income
Diagra​matic repres​ent​ations of the Opport​unity cost
maximum combin​ation of two products that Main economic agents: househ​olds, firms
The costs of an economic decision
an economy can produce when all its and govern​ments
measured in terms of the best altern​ative
resources are used effici​ently, per time closed economy : part of the circular flow of
choice foregone
period income comprising only domestic decision
Example: the opport​unity cost of studying ib
Full employment : all factors of production makers
economics is another's individual and
are fully utilized. There are no unemployed open economy: part of the circular flow of
societies subject you could be studying
resources income comprising domestic and foreign
instead
Efficiency: all resources are put to their best economic decision makers
use and there is no wastage in the Circular flow of income injections: put money into the circular flow
production process of income
Assump​tions of the model: fixed production leakages: take money out of the circular
possib​ili​ties, scarcity, constant state of flow of income
techno​logy, efficiency

Economic method​ology

The study of the processes, practices and


principles in relation to the discipline of
macroe​conomic tool used to explain how
economics as a social science through the
activity and national income are determined
use of models, theories and assump​tions
that underlie economic reasoning

By egomezc Published 10th April, 2022. Sponsored by CrosswordCheats.com


cheatography.com/egomezc/ Last updated 10th April, 2022. Learn to solve cryptic crosswords!
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