Unit one: Microeconomics

what makes a good scarce?

-Limited in quantity -desirable - more than one use

Wants/Needs

a need is something essential for survival eg. food. A want is something desirable but not essential to survival eg. coke.

Shortages/ Surpluses

A shortage occurs when the quantity demanded for a good exceeds the quantity supplied at a specific price. A surplus occurs when the quantity supplied of a good exceeds the quantity demanded at a specific price.

comparitive advantage

An economy's ability to produce a good or service at a lower opportunity cost then it's trading partners

Scarcity

Demand for good or service is greater than the availability

Economics

Study of scarcity, use of resources and production of goods and services

Price

The amount of money that has to be paid to get a good or service

Value

The measurement of the benefit derived from a good or service to an individual or company

opportunity cost

value of the next highest valued alternative use of that resource