Economics intro & basic economic problem

Economics

The study of how individuals and societies make decisions to maximize scarce resources.

Relative Scarcity

The basic economic problem where human needs and wants exceed available resources.

Needs

Basic requirements for survival, such as food and water.

Wants

Desires that improve comfort or living standards, such as smartphones or vacations.

Product

Anything offered to consumers to satisfy their desires or needs, classified as goods or services.

Goods

Physical objects that provide benefits to consumers, such as laptops, cars, or bread.

Services

Actions that benefit consumers, for which they pay, such as legal advice or bike repair.

Microeconomics

Branch of economics that studies decision-making by individuals, households, and firms in specific industries.

Macroeconomics

Branch of economics that studies the decision-making for the economy as a whole, focusing on national factors like spending and employment.

Factors of Production

Another term for the resources used to produce goods and services.

Decision-making in Microeconomics

Involves individual and firm choices regarding spending, investment, and resource allocation.

Decision-making in Macroeconomics

Involves national concerns such as unemployment, inflation, and government spending.