1. Department of Computer Science & Software Engineering Software Engineering Economics (ECON 403)

2.  Email: m.miraz@uoh.edu.sam.miraz@uoh.edu.sa  Room: Portable-4, Room- 2  ECON403: Section 001 (Boys) Section 101 (Girls)

3. o Generic constraints of Resource Scarcity o Unlimited Demanding Behaviours of Consumers o Profit Driven Behaviour of producers o The conservative behaviors of market systems

4.  Scarcity refers to the tension between our limited resources and our unlimited wants and needs.  For an individual, resources include time, money and skill.  For a country, limited resources include natural resources, capital, labor force and technology.

5.  The principle of resource scarcity states that the total resources at a given time R Σ (t), or the means of production represented by their values, such as land Vl(t), building Vb(t), materials Vm(t), labor Vlb(t),and capital Vc(t), are constrained by a constant of nature k(t), which is always inadequate to meet the ever growing total demands D Σ (t).  R Σ (t) = Vl(t) + Vb(t) + Vm(t) + Vlb(t) + Vc(t)  = k(t)  < D Σ (t)

6.  Pmax(t) = Rmax(t) - Cmin(t)

7.  Opportunity cost is the value of what is foregone in order to have something else.  This value is unique for each individual.

8.  Demand refers to how much (quantity) of a product or service is desired by buyers.  The quantity demanded is the amount of a product people are willing to buy at a certain price;  the relationship between price and quantity demanded is known as the demand relationship.

9.  Supply represents how much the market can offer.  The quantity supplied refers to the amount of a certain good producers are willing to supply when receiving a certain price.  The correlation between price and how much of a good or service is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply and demand.

10.  The higher the price, the lower the quantity demanded.

11.  This means that the higher the price, the higher the quantity supplied

12.  When supply and demand are equal (i.e. when the supply function and demand function intersect) the economy is said to be at equilibrium.