Economics 101 Week 1: chpt. 1 in class notes
Economics 101 Week 1: chpt. 1 in class notes ECN 101
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This 2 page Class Notes was uploaded by Sydney on Friday September 2, 2016. The Class Notes belongs to ECN 101 at Saint Martin's University taught by Riley R. Moore in Fall 2016. Since its upload, it has received 27 views. For similar materials see Principles of Economics in Economics at Saint Martin's University.
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Date Created: 09/02/16
Chpt. 1 in class notes Challenge of Economics 8/31/2016 Scarcity Lack of available resources. The main cause of economics. Economics study of how to best allocate scarce resources. “Study of scarcity” Opportunity Cost Most desired goods and services are forgone to obtain something. “Not always monetary. When you make a choice there is a cost. Economists try to quantify everything so it’s easier to compare” “Easiest ways to earn wealth Inheritance, Marry into it, last resort earn it.” Rational ActionWeigh benefits against the opportunity costs. ↳decide whether or not to make the choice. Factors of production Land, labor, capital, entrepreneurship ↳Inputs used to produce goods ↳Not always monetary, Real capitalWhat is used /services to provide service or produce product. “No market if not entrepreneurship ↳Risk takers in society” Difference between Innovation and Entrepreneurship: InnovationNew idea, but not always marketable Ideas from Engineers usually. EntrepreneurshipSees market potential in ideas. usually business. Basic Questions: What to produce How to produceFor whom to produce “(politicians are the ones who ask “why”)→Usually require costbenefit analysis.” 9/2/2016 What to produce not enough resources to make all the goods/services desired by society. Have to decide what is wanted/needed most. Have to sacrifice lessdesired activities/goods. Production possibilities curve nonlinear to show inefficiency. Production possibilities increase with more resources and better technology. https://14yonena.wordpress.com/2012/09/12/economicschapter12pra ticequestions/ How Goal for every society is to find an optimal method of producing goods and services. “90’s was a game changer for technology. Economists thought that the prosperity would cause inflation. Pricewage cycle Healthy growing economies always has some inflation caused by no unemployment makes employers need to offer more money to make jobs desirable. 90’s did not crash because there was more output for every input because technology made everyone more efficient, companies did not have to hire more people.” Whom How economies output is distributed across members of society. Usually decided by government. Distribution is based on productive contributions, need or combination of both. ↳Being able to distribute based on need show how strong an economy is. “Government tries to forecast, the closer the timeline is, the more accurate it will be. Further out is more uncertainty. Economic Output Measured in gross product. In the U.S 70% is consumption. To be leader in global market, need to export not just consume. U.S is not labor driven. Nonprice factors Way for businesses to be unique. Create niche or “monopoly” creates less competition. Consumers want competition because it drives down prices more quantity and better quality. Economics is trying to find causation rather than correlation.”