What Economics is, Scarcity, Oppurtunity Cost [+MoreKeyTerms]

What is Economics?

• Economics has many definitions, but the most accepted of them all was given to us by Prof. Lionel Robbins. It is as follows:
  • Economics is the social science which studies human behaviour as well as relationship between ends [wants] and scarce means which have alternative uses.
• Which means that Economics studies the choices we humans make as we have seemingly unlimited wants and scarce resources - we can't fufill all our wants at the same time.

Scarcity

• Scarcity is a situation where there aren't enough resources to fufill everyone's wants.
• Scarcity will continue to exist. More goods and services are being produced now more down ever, but as the same time people's wants increase. They not only want what is available, but what is yet to come out. Scarcity will never cease to exist.
• The basic economic problem arises because of scarcity. There is no limit to people's wants - they are infinite. People want more than is available. This mismatch, between what people want and the maximum that can be produced, is The Economic Problem.

Oppurtunity Cost

• Oppurtunity cost is the evidence of scarcity in the world. The fact that that people have to choose which products to buy, what jobs to do, and which products to produce shows that there are insufficient resources.
• When we choose to do something, whe choose not to do something…