Economics 120 Book Notes

Economics 120 Book Notes - Economics 120: Summer 2007...

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Economics 120: Summer  2007 Reading Notes: 06.20 Chapter 1 I. Definition of Economics A.  It is the social society concerned with the efficient use of scarce resources to achieve the maximum  satisfaction of economic wants II. Economic Perspective A. Economic way of thinking B. Scarcity and Choice 1. Scarcity limits our options and necessitates that we make choices 2. There is no free lunch C. Rational Behavior 1. Economics assumes that human behavior reflects “rational self-interest.” Individuals look for and  pursue opportunities to increase their utility – That is pleasure, happiness, or satisfaction.  2. The same person may make different choices under different circumstances. 3. Choices may vary greatly among individuals. D. Marginalism: Benefits and Costs 1. Marginal Analysis a) Comparisons of marginal benefit and marginal costs. 2. Each decision involves marginal benefits and marginal costs. III. Why Study Economics? A. Economics for Citizenship 1. A basic understanding of economics is essential for well-informed citizens. B. Professional and Personal Applications 1. Studying economics helps students improve their analytical skills which are in great demand in  the workplace. 2. An understanding of the basics of economic decision making and the operation of the economic  system enables business managers and executives to increase profits.  3. Economics helps consumers and workers make better buying and employment decisions. 4. An understanding of economics makes for better financial decisions. IV.
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This note was uploaded on 04/22/2008 for the course ECON 120 taught by Professor Wade during the Summer '08 term at San Diego.

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Economics 120 Book Notes - Economics 120: Summer 2007...

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