Tradeoffs comparative advantage and the market system.pdf - Tradeoffs Comparative Advantage the Market System Errol D\u2019Souza Email [email protected] 1

Tradeoffs comparative advantage and the market system.pdf -...

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1 Tradeoffs, Comparative Advantage, & the Market System Email: [email protected] Errol D’Souza
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2 Decisions of managers reflect key fact of economic life: SCARCITY . Scarcity exists because we have unlimited wants and limited resources to satisfy those wants. Goods and services are scarce as are economic res- ources or factors of production workers, capital, natural resources, entrepreneurial ability used to make them. Scarcity requires trade-offs . Time for instance is scarce. If you spend an hour studying you have one hour less to go to the movies. If Maruti Suzuki decides to devote some of its scarce workers and machinery to producing more Swift cars those resources will not be available to produce more Baleno cars. Errol D’Souza
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