1. UNIT VI – Fundamentals of Economics
Scarcity
UNIT VI – Fundamentals of Economics

2. What is scarcity?
Concept that ALL of the things we want and need are limited
There are not enough resources for everyone to have unlimited access to everything

3. How do we solve scarcity?
Certain questions have to be answered in order to decide how to get limited resources to as many people as possible
These questions are…
What to produce?
How to produce?
For whom to produce?

4. Producer v. Consumer
Producer – the individual or manufacturer who is creating the goods and services
Consumer – the individual that purchases the goods and services

5. Economic Models
Economists try to answer these questions through the creation of economic models.
They are simplified representations of the real world that are used to explain how the economy works

6. Macro v. Micro Economics
Macroeconomics – study of the economy as a whole
Microeconomics – study of individual consumers and businesses
Economic models will be created by economists to look at how both levels of economics can be affected by decisions of producers and consumers