Basic
Concepts of Economics
- Macro vs. Micro-
- Macroeconomics: Study of economy as a whole.
- Inflation, minimum wage, international trade
- Microeconomics: Study of individual or specific units of the economy.
- How households & firms make decisions & how they interact with markets
- Positive Economics vs. Normative Economics-
- Positive Economics: Attempt to describe the world as is.
- Very descriptive, collects & presents facts
- Normative: Attempt to prescribe how world should be.
- Opinion based
- Needs vs. Wants-
- Needs: Basic requirements for survival.
- Wants: Desires.
- Scarcity vs. Shortage-
- Scarcity: Permanent; Most fundamental economic problem facing all societies.
- Unlimited wants w/ limited resources
- Shortage: Temporary; Quantity demanded exceeds quantity supply.
- Goods vs. Services-
- Goods: Tangible commodities; Can be bought, sold, traded & produced.
- Capital Goods: Items used in creation of other goods.
- Consumer Goods: Intended for final use by consumer.
- Services: Work performed for someone.
The video was a more in depth explanation about scarcity versus shortage and it helped me out.
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