Chp1 - Chapter1CHOICES:THEBASICS 1.1INTRODUCTION 2...

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Chapter 1  CHOICES: THE BASICS
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2 1.1 INTRODUCTION
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3 Get to choose what  TV show to watch Get extra dessert  at dinner Do the laundry Cook dinner Household Household
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4 Society What job will be done and who will do them grow food make clothing design computer software… Who will get the output of goods and service Who will eat caviar and who will eat potatoes; Who will drive Ferrari and who will take bus...
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5 Let’s go!
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6 1.2 THREE CONCEPTS SCARCITY CHOICES OPPORTUNITY COST
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7 1.2.1 SCARCITY Definition the limited nature of society’s resources. 1. we seek to satisfy our many and varied needs  and wants 2. but our income is scare 3. so we have to make  choices  about which needs  and wants we will satisfy. Model  an assumption + a constraint = a consequence
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8 NEEDS AND WANTS Needs : need to survive basic food, clothing, shelter Wants: would like to have but not for  survive fast food, chic clothing, good music  collection, tickets to rock concert…
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9 NEEDS Physiological needs to remain alive physically e.g. oxygen, water, basic food, shelter,  refuge… Social needs to belong to the society e.g. TV set, radio, telephone…
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10 1.2.2 CHOICE Time of students Income of family Guns and butter Efficiency and equity
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11 Time of students Watching TV Time Economics Psychology Napping Part-time job
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12 Income of family buy food, clothing family vacation retirement children’s college education
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13 Income wages or salaries interest profits dividends rent
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14 Efficiency The property of society getting the  most  it  can from its scarce resource Equity The property of distributing economic  prosperity  fairly  among the members of  society
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