economics

The Economic Problem

How to allocate scarce resources among alternative uses

Scarcity

A situation that arises when there are not enough resources available in order to satisfy the infinite human wants

Opportunity Cost

In decision making, the value of the next best alternative foregone

Renewable resources

A resource that can be used repeatedly and does not run out because it is naturally replaced

Non renewable resources

A resource which one exploited can not be replaced

Cetaris parabus

Other things being equal (only one thing can change at a time)

Positive Statement

Def : A statement about what is

Can be fact checked to see it its true

Normative Statement

Def : A statement that involves a valued judgement about what ought to be

A considered opinion

Capital

Enterprise

Land

Labour

Production Possibility Frontier