251Ch1lecture2Notes - Ch1: What is Economics Lecture 2:...

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8/21/2011 1 Chapter 1: What is Economics? Lecture 2: Scarcity, Resources, and Incentives Scarcity Scarcity = available resources are insufficient to satisfy wants • What’s not scarce? Ch1: What is Economics Lecture 2: Scarcity, Resources, and Incentives 2 3 Economic Resources 1. Land (natural resources) 2. Labor 3. Capital 4. Entrepreneurship
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Unformatted text preview: Ch1: What is Economics Lecture 2: Scarcity, Resources, and Incentives 4 Incentives Incentives: Rewards or penalties that encourage or discourage an action If benefits > costs Do it! If benefits < costs Dont do it! Ch1: What is Economics Lecture 2: Scarcity, Resources, and Incentives...
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This note was uploaded on 09/21/2011 for the course ECON 251 taught by Professor Blanchard during the Spring '08 term at Purdue University-West Lafayette.

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