what is economics? teks/notes
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What is Economics? TEKS/Notes. UNIT 2. Fundamental Economic Problem facing all societies is scarcity - society not having enough resources to produce all the things people want Unlimited Wants and L imited R esources force societies and individuals to make choices . - PowerPoint PPT PresentationTRANSCRIPT
What is Economics? TEKS/Notes
UNIT 2
Scarcity & Choice • Fundamental Economic
Problem facing all societies is scarcity- society not having enough resources to produce all the things people want
• Unlimited Wants and Limited Resources force societies and individuals to make choices
• Basic Economic Questions
Each society must answer three basic questions
• 1. What to Produce?-military equipment, food, clothing or housing
• 2. How to produce?- Mass production or high labor
• 3. For whom to produce?- who gets what
Required to Produce the Things We Want or Need
Trade Offs-Alternatives given up when one option is chosen rather than another.-An exchange of one thing in return for another.
Opportunity Cost Cost of the next best
alternative use of money, time, or resources when one choice is made over another
• A diagram representing various combinations of goods and /or services an economy can produce when all production resources are fully employed (P. 123 Figure 1.6)
Production Possibilities Curve
Production Possibility Frontier Curve