Scarcity In Economics Flashcards
Define economics
The allocation of scarce resources
It relates to the human and social world
What would describe micro economics as?
Involves the small things in the market
The includes economies, firm and markets
Name one benefit of studying economics
It provides people with a lot of skills that are valued by employers.
True of False: Allocation is how things are divided up
TRUE
Something we use to provide and good or service to satisfy human needs is defined as?
A resource
Define Scarce
Resources that are not in abundance
What is the premises of micro economics?
How individuals firms make difficult decisions as how scarce resources are to be used.
What is opportunity cost and give 1 example to it?
This is when we make a decision to do something or not at the expense of something else.
What we lose when we make this decision is described as the opportunity cost
Example would be when going to university for four years. You could’ve sent those four years
What are three fundamental questions of microeconomics
What goods and service should be provided
How will they be produced
Who will buy them
What is the role of prices?
Allocation
Rationing
Signalling
What is the role of technology in in pricing
Helps to ration demand
Helps to advertise and gives those who are willing to buy and. Opportunity to do so
What is the role of theoretical economics
Too build a model of some behaviours that are testable predictions
Wha is the aim of empirical economics
To test model that have been built
Distinguish between normative and positive economics
Positive economics describes the way are currently or the situation that we are in
