UNIT 1 : January 5th, 2016

Macroeconomics-

•  study of economy as a whole inflation
• wages
• international trade

VS.

Microeconomics-

• study of individual specific units of the economy
• supply and demand
• market structures
• business organizations

Positive Economics-

• attempts to describe the world as is
• very descriptive
• tends to thrive on the "what is"
• collects/ presents facts only

VS.

Normative Economics-

• attempts to prescribe how the world should be.
• opinion based
• "ought to be" "should be"

Needs-

• basic requirements for survival
• food, water, shelter, clothing

VS.

Wants-

• desires of citizens

Goods-

• tangible commodities
• Capital Goods: items used in creation of other goods
• Consumer Goods: Goods intended for final use by the consumer

VS.

Services-

• work preformed for someone
• examples: concerts, beauty shops

Scarcity-

• the most fundamental economic problem all societies face
• how to satisfy unlimited wants with limited resources
• examples: oil/gas

VS.

Shortage-

• where quantity demanded is greater then quantity supply.