New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

Week 1 Notes: Introduction to Economics

by: Cheyenne Hunt

Week 1 Notes: Introduction to Economics Econ 2020

Marketplace > Auburn University > Business > Econ 2020 > Week 1 Notes Introduction to Economics
Cheyenne Hunt
GPA 3.33
View Full Document for 0 Karma

View Full Document


Unlock These Notes for FREE

Enter your email below and we will instantly email you these Notes for Principles of Economics: Microeconomics

(Limited time offer)

Unlock Notes

Already have a StudySoup account? Login here

Unlock FREE Class Notes

Enter your email below to receive Principles of Economics: Microeconomics notes

Everyone needs better class notes. Enter your email and we will send you notes for this class for free.

Unlock FREE notes

About this Document

These notes cover a basic introduction to economics, circular flow, and demand.
Principles of Economics: Microeconomics
William M. Finck
Class Notes
Economics, Microeconomics, demand, Circular Flow




Popular in Principles of Economics: Microeconomics

Popular in Business

This 5 page Class Notes was uploaded by Cheyenne Hunt on Wednesday January 20, 2016. The Class Notes belongs to Econ 2020 at Auburn University taught by William M. Finck in Spring 2016. Since its upload, it has received 29 views. For similar materials see Principles of Economics: Microeconomics in Business at Auburn University.


Reviews for Week 1 Notes: Introduction to Economics


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 01/20/16
Chapters 1 and 2: Introduction to Economics Jan 15 What are we studying? o Choices; micro= individual choices, macro= institutions and society choices o Economics- the social science concerned with how individuals, institutions, and society make optimal choices under conditions of scarcity  Scarcity- the condition whereby the resources we use to produce goods and services are limited relative to our wants for them  Scarce good- economic good- good for which you can NOT get all you want at zero cost  Free good- opposite of scarce good; you CAN get all you want at zero cost Price vs. Cost o Price- signal that tells producers what and how much to produce; in a standard market transaction it is paid by the consumer o Cost- the sacrifice associated with making a choice; in a standard market transaction it is paid by the consumer Types of Costs (Chapter 9) o Explicit costs- out-of-pocket, monetary payments o Implicit/opportunity cost- most valued option forgone; 2nd best choice o Economic cost= explicit costs + implicit costs Resources o The inputs used in the production of goods and services; factors of production  Natural resources- land, oil, lumber, etc.  Labor resources- physical and mental talents used in production  Capital resources- all manufactured goods used in production How do we make choices? o We try to maximize our utility by using marginal decision making  Utility- the satisfaction a consumer obtains from the consumption of a good or service  Marginal- additional; the change that results from an additional unit  NOTE: utility maximization by producers and consumers usually maximizes social welfare Jan 20 Purpose o To use economic principles to create models that enable us to analyze and predict behavior  Economic principles- statements about economic behavior or the economy that enable the prediction of probable effects of certain actions  Model-a simplified representation of how something works The Market Model (Chapter 3) o Market- any institution that brings together buyers and sellers of a particular good or service  Product market- households demand goods and services which are supplied by firms in exchange for money  Resource market- firms demand resources which are supplied by households in exchange for money Circular Flow Demand o Demand schedule- a Price $10 $8 $6 $4 $2 $0 table that shows how much 0 0 0 0 0 of a good or service Quantity 0 40 80 12 16 20 consumers will want to demanded 0 0 0 buy at various prices o Law of demand- the price of a good and the quantity demanded are inversely related o Demand curve  A line that shows the maximum that consumers are willing to pay for any quantity  Demand- the relationship between price and quantity demanded for all possible prices  Change in demand is a shift of the entire curve to the left or right  Quantity demanded- the number of units consumers are willing to buy at a specific price  Change of the quantity demanded is caused by a change in the price; a movement along the curve  Factors that Shift the Demand Curve  Income  Normal goods- goods for which income and demand move together  Inferior goods- goods which income and demand move opposite  The only way to determine the classification of the good is by the relationship between income and demand Jan 22  Tastes and Preferences  Fads and other sudden trends have a positive impact on demand (move in the same direction)  Substitutes and Complimentary Goods  The price change of a substitution moves in an opposite direction of the demand for the good  The price change of a complimentary good does not change the demand of the other good because they are used together  Expectations of Future Prices  The demand for a good is higher when the expected price is lower  Number of Buyers  Demand is high if there are more buyers in the market


Buy Material

Are you sure you want to buy this material for

0 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."

Allison Fischer University of Alabama

"I signed up to be an Elite Notetaker with 2 of my sorority sisters this semester. We just posted our notes weekly and were each making over $600 per month. I LOVE StudySoup!"

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."

Parker Thompson 500 Startups

"It's a great way for students to improve their educational experience and it seemed like a product that everybody wants, so all the people participating are winning."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.