eco 1

Economics

The study of production, distribution, and consumption of material goods and services in a world of scarce resources.

Scarcity

Scarcity occurs when the social desirability for something exceeds its availability.

Opportunity cost

The cost of something is what must be given up to get it.

Incentives

People are motivated by benefits and costs when making decisions.

Private good

Goods provided primarily by businesses for personal use, characterized by rivalry in use and exclusive ownership rights.

Public good

Goods provided mostly by governments or non-profits, non-rival in use, and non-exclusive in ownership.

Community goods

Rival in use, non-exclusive goods (e.g., public parks).

Club goods

Non-rival in use, exclusive goods (e.g., membership subscriptions).

Human capital

Intangible assets like knowledge, abilities, talents, and health that contribute to labor productivity.

Real capital

Physical assets like machines, equipment, and buildings used in production.