Lecture 1 Econ 111.docx - Econ 111 Microeconomic Principles Lecture 1 Introduction to Microeconomics Key Terms Scarcity Opportunity cost Two big

Lecture 1 Econ 111.docx - Econ 111 Microeconomic Principles...

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Lecture 1: Introduction to Microeconomics Key Terms: Scarcity, Opportunity cost Two big economic questions: • How do choices determine what, how and for whom goods and services get produced? • When do choices made in self-interest also promote the social interest? Market brings buyers and sellers together in exchange of goods/services. Enables both parties to get the information they require and engage in exchange. 1.1Definition and Q’s. Globalisation refers to the expansion of international trade and financial (capital) flows as well as the production of components and services by firms operating across national borders. Immigration critical feature of globalisation. Expansion causes disruption. E.g. GFC. Microchips, satellites and fibre-optic cables have lowered the cost of communication. Globalisation – in the interest of the owners of multinational firms that profit from the process of globalisation however is it in the social interest? 1.2Economic way of thinking. Economic ideas. 1. Choice is a trade-off. Trade-off is an exchange giving up one thing to get something else. 2. Cost is what you must give up to get something 3. Benefit is what you gain from something - Measured by what you are willing to give up. In a monetary economy this is often measured by what you are willing to pay for something.
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