This document provides an introduction to basic economics concepts. It defines economics as the study of how people produce and exchange goods and services. It explains that a market is where voluntary exchanges occur and that a market economy allows goods and services to be exchanged freely. It notes that scarcity exists because resources are limited and cannot satisfy all wants. It identifies the four basic types of resources as natural resources, human resources, capital resources, and entrepreneurship. It also defines the concepts of opportunity cost, trade-offs, macroeconomics, and microeconomics.

1. Economics Chapter One Notes What is Economics?

2. Abbreviations: ∆ bldg., svcs., nat. e.g. i.e. b/c w/ w/o * think about text messaging--

3. What Is Economics? ECONOMICS: The study of people producing & exchanging things of value to get Goods & Services MARKET: A place where voluntary exchanges of goods & services take place MARKET ECONOMY: An economic environment where goods & services are exchanged voluntarily SCARCITY: The result of the inability to satisfy everyone’s wants. ALL RESOURCES ARE SCARCE (i.e., TIME, $$, TREES, CARS, ETC.)

4. RESOURCES: basic elements used to produce goods and svcs.  There are 4 basic types: NATURAL RESOURCES: Unaltered gifts of nature (trees, minerals, water, etc.) HUMAN RESOURCES: Labor; physical and mental efforts exerted by people to create goods & svcs. CAPITAL RESOURCES: Bldgs., tools, machines people use to create goods & svcs. (also known as overhead) ENTREPRENEURSHIP: Imaginative thinking, willingness to take risks, mgmt. & org. skills needed to operate an innovative business.

5. BASIC PRINCIPLES OF ECON. OPPORTUNITY COST: ALWAYS the best alternative you give up when making a choice. Giving up basketball shoes to buy a TV- Opp. Cost = Shoes TRADE-OFFS: b/c resources scarce, must choose some things over others. This is a: TRADE-OFF — the process of determining your opportunity cost (e.g., shoes for TV)

6. Basic Principles, (cont’d.) MACROECONOMICS: The “Big Picture:” Issues such as unemployment, poverty, budgets, etc. MICROECONOMICS: “ Individual Issues:” Personal finance, indiv. consumerism, etc. How macro issues like unemployment, productivity affect people.

7. What Resources Are Present?

8. What Resources Are Present?

9. What Resources Are Present?