The economic problem: scarcity and choices
Why the economy exist
2 basic facts:
1. Wants are unlimited
2. Productive resources are scarce
we cannot satisfy all our wants
An economy has to decide how to use its scarce resources to give the maximum
possible satisfaction to the members of the society.
An economy has to solve some basic problems called Central Problems of an
economy
Central Problems of an economy
What to produce
How to produce
For whom to produce
The economic problem
If wants are satisfied new wants arise
Whit a larger income come more wants
Economize= maximize our wants with very limited needs
Free and scarce goods
Free goods= goods that are so plentiful
Scarce goods= economic goods
scarcity is relative to the demand
Free and scarce
Economizing= whether to have a little bit more of one and so much of another
its not rejecting one in favour of the other
Scarcity and decision makers
Values, benefits and
opportunity cost influence the
decision
Why the economy exist
2 basic facts:
1. Wants are unlimited
2. Productive resources are scarce
we cannot satisfy all our wants
An economy has to decide how to use its scarce resources to give the maximum
possible satisfaction to the members of the society.
An economy has to solve some basic problems called Central Problems of an
economy
Central Problems of an economy
What to produce
How to produce
For whom to produce
The economic problem
If wants are satisfied new wants arise
Whit a larger income come more wants
Economize= maximize our wants with very limited needs
Free and scarce goods
Free goods= goods that are so plentiful
Scarce goods= economic goods
scarcity is relative to the demand
Free and scarce
Economizing= whether to have a little bit more of one and so much of another
its not rejecting one in favour of the other
Scarcity and decision makers
Values, benefits and
opportunity cost influence the
decision
