Hey, guys. Let's go ahead and define some key terms that'll help us understand and answer the question, what is economics? So our first term here, scarcity, it's the idea that in this world we have unlimited wants, but only limited resources to fulfill those wants. Right? So, for example, you know, my wants, I want a new guitar. I love to travel. Shoot. I'd even love to go to the moon. But it's gonna be kinda tough. Right? What kind of resources do I have? I definitely don't have a spaceship, so that's not gonna be happening anytime soon. I've got my time. So if I were to travel, yeah, I'd have the time for it, but what about the money? I don't have the money right now. I've got well, I've got my empty bank account. At least I have that. Maybe I can put some money in it eventually. So that's the idea. Right? We're gonna have to pick our battles here. We've only got limited resources and we've got all sorts of things that we're gonna want in this world. It kinda leads us to our next topic, trade-offs. It's the idea that we have to give up one thing to get something else. So for example, tonight, I've been planning to go to the Panthers game with my dad for a while here. Panthers, the Florida Panthers, that's our hockey team down here. And just last night, my friend calls me that there's a big party happening tonight, and all my friends are gonna be there. Well, I'm gonna have to pick 1 or the other here, right, and I'm spoiler alert I'm not gonna sell out my dad so I'll go to the Panthers game tonight. But it's not always 2 things that we're choosing between. What if it's your day off and you just wanna go to the beach? Right? Maybe you got the day off. Let's go to the beach. What are you giving up to go to the beach? Well, the opportunity to just stay home. Right? You could have just stayed home instead. Just relax at home. So, you know, there's always something you're giving up, and that's the idea of an opportunity cost, The value of the next best alternative to a choice. Right? So a good example is something you'll probably relate to, going to college. Right? When you go to college, you're giving up the opportunity to get a full-time job right away. Right? Maybe some of you have part-time jobs. I'm sure a lot of you are full-time students too though. The idea here is that when you go to college, yes, you have all the costs of college tuition, fees, room and board, books, right? But there's also that opportunity cost of having gotten a job right away. So you're giving up all that money you could have already been making. So with these concepts, let's define economics.
Introduction to Economics - Online Tutor, Practice Problems & Exam Prep
Defining Economic Terms:Scarcity, Trade-offs, and Opportunity Costs
Video transcript
Definition of Economics:Micro vs. Macro
Video transcript
Alright. So let's quickly discuss the difference here between microeconomics and what we're studying here, macroeconomics. Economics, in general, is defined as a social science focused on the decisions made by individuals, institutions, and society under conditions of scarcity. The key idea here is scarcity, where we have scarce resources and how we are going to use these resources. The decisions that we make on an individual level and on larger levels as well.
In microeconomics, a course might teach you about the choices that individuals and businesses make, such as how prices affect a market for a certain product, the supply and demand of a product, how a business maximizes its profit, and how many laborers to hire. These are all micro ideas on a small scale, concerning what one business or one person might do in one market.
However, here in this course, we're talking about macroeconomics, which deals with the 'big picture'. We're discussing bigger issues, studying the economy as a whole, focusing on nations, not just national but global economics. We're going to deal with bigger ideas like recessions and what causes recessions, the causes of economic booms, and inflation. We'll explore how inflation affects interest rates and the supply of money, along with issues like unemployment. We aim to understand the reasons why unemployment happens, the types of unemployment that exist, and the effects they have on the economy.
Here in this course, we're focusing on macroeconomics, but you might also encounter questions that ask whether a specific issue deals with microeconomics or macroeconomics. It's good to understand the difference between the two.
Alright, let's go ahead and move on to the next topic.
The opportunity cost of going to a baseball game is
Economics can be best defined as the study of
