ec-4 - believe) i. Every good or service is owned by a...

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1. We divide people into different tasks b. Why is specialization helpful? i. Skill/talent matching 1. Learning by doing (experience) II. Two basic concepts a. Jobs b. Firms i. An organization devoted to producing a single good, or a group of closely related goods c. A new problem i. Allocation and distribution (this may be the central problem of economics) ii. Allocation – deciding who gets what 1. Making decisions about which people will get which goods in which quantities iii. Distribution – carrying out the allocation 1. Transporting goods and services to the people who will consume them iv. Sometimes your allocation decisions are affected by your problems of distribution v. Allocation and distribution is the central problem of economics III. Property Rights (rights of ownership) a. Every good or service has a property right attached to it (or so we like to
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Unformatted text preview: believe) i. Every good or service is owned by a person or group ii. The right to control who uses an item and/or how it is used. Also called a right of ownership b. Options of a holder of a property right to a good or service (its owner): i. Use it ii. Sell it (give up the right, permanently) iii. Rent it (give up the right, temporarily) iv. Give it away v. Throw it away c. Systems for allocation and distribution i. Scheme for assigning property rights (allocating ownership) ii. Method for changing the assignments (transferring ownership) IV. Economic agent a. An individual or group that makes economic decisions b. Three types of economic agents i. Households ii. Firms iii. Government agencies...
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ec-4 - believe) i. Every good or service is owned by a...

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