Key Points
The Economic Problem:
Human wants are unlimited, but resources (like time, land, and money) are limited. This mismatch causes scarcity.
◦ Opportunity Cost:
Every time you make a choice, the value of the next best alternative you give up is your opportunity cost.
◦ The 3 Central Questions:
Every economy must decide What to produce, How to produce (labour-intensive vs. capital-intensive), and For whom to produce.
●Economic Systems:
◦ Market Economy:
Driven by private individuals, demand, and supply.
◦ Planned Economy:
Directed completely by a central government authority.
◦ Mixed Economy:
Blends both private businesses and government regulation