the study of how we fufil unlimited wants on limited re$ources
(the study of decisions)
not having enough ($) to buy what you want
2 parts of economics
economics @ the NATIONAL or INTERnational level
your PERSONAL econ. (budget, salary debt)
cost of one item in terms of another item (bicycle v. laptop-dont have the money for both)
where you have a need (one) & you buy the less expensive item that meets the need
ex. Porche > Toyota (need=transportation)
THE factors of productions
people who "work for me"
building where product is made-what goes into the product
OWNER, person who creates the business
cost of capital
interest (money you pay to use someone else's money)
cost of human resources
wage (your salary-how much youre paid)
cost of natural resources
rent(what you pay for the material)
cost of entrepeneurship
profit (difference b/t sales price & overhead)
what it costs to produce your product
(interest, wage & rent)
4 basic economic ?'s
determine what type of ec. system a country has
who determines what the maker make in the U.S
THE 4 ecomonic ?'s
What am I going to make it?
Who gets to buy it?
How am I going to [make] it?
How will I [distribute] it?
4 ec. systems based on how you answer the 4 ?'s
do things the way it has always been done (not inc. modernization)
where the gvmt. answers the ?'s
where the consumer answers all the ?'s
(what the U.S is)
a comb. of free market & command