AUDIDODGE

HAMPTONSNEWPORT BEACH

 Although your wants/desires are virtually unlimited, the productive resources available to help satisfy those wants are scarce  Scarcity – condition facing all societies b/c there are not enough productive resources to satisfy people’s unlimited wants

 Productive resources – inputs used to produce goods/services that people want Also known as factors of production  Productive resources are scarce when they are not freely available You must choose among your many wants Can’t satisfy all wants

 Economics – examines how people use their scarce resources to satisfy their unlimited wants  Taxi cab driver The cab Knowledge of the city Driving skills Gasoline Time

 Human – human efforts used to produce goods/services Also known as labor

 Natural – “gifts of nature”  Renewable – resource that can be drawn on indefinitely if used wisely  Exhaustible – resource available in a limited amount

 Capital – all human creations used to produce goods/services Factories Trucks Machines Buildings Money  Entrepreneur – person who develops a new product/process and assumes the risk of profit/loss

GOODSERVICE  Something that is tangible; you can see, feel, and touch  Requires scarce resources to produce  Satisfies human wants  Something that is intangible;  Requires scarce resources to produce  Satisfies human wants

MICROECONOMICSMACROECONOMICS  Market economics  Focuses on the economic behaviors of everyone making choices  Individual pieces of the economic puzzle  National economics  Focuses on the performance of the economy as a whole  Fits all of the puzzle pieces together to look at the big picture

POSITIVE STATEMENTNORMATIVE STATEMENT  Statement about the economic reality that can be supported/rejected with facts  Concerned with “what is”  Statement about the economic reality that reflects one’s opinion  Concerned with “what should be”

 Opportunity cost – the value of the best alternative you must pass up  Also can be looked as the opportunity lost

 What goods/services will be produced?  How will they be produced?  For whom will they be produced?