Chapter 2

Chapter 2 - Chapter 2 Scarcity if a good is scarce relative...

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Chapter 2 Scarcity- if a good is scarce relative to the desire to own or use it, choices must be made True even if no shortages exist Good- something that could satisfy a want Economic goods- scarce goods for which desire to own or use them exceeds their ability at a price of 0. Cars, diamonds,food Venn diagram All economic goods are goods Not all Goods are economic goods Relative clean breathing air in Athens’ Ga Probably not an economic good Note the diagram above that the area of the rectangle includes the oval People have essentially unlimited wants Ending world hunger Improved national defense Sapace travel and exploration 3 fundamental questions All economies must decide What to produce For whom to produce How to produce Factors of production Land- anything that isn’t made by humans and is used in the production process Labor- human work effort Capital Physical capital: things made by humans that help us produce. machines, factory computers Tangible things made by humans that help in the production of
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Chapter 2 - Chapter 2 Scarcity if a good is scarce relative...

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