Chapter 1:

Economics is the study of choice under conditions of scarcity.

Scarcity is the situation in which the amount of something available is
insufficient to satisfy the desire for it.
Opportunity cost is the cost of any choice is what we must forego when we
make that choice. It also includes both explicit and implicit costs.
When the alternatives to a choice are mutually exclusive (not able for both to be
true at the same time), only the next best choice the one that would actually
be chosen is used to determine the opportunity cost of the choice. E.g. The cost
of going to university includes both the cost of fees being paid (doesnt include
lodging and transport as they would both be amounts spent regardless of
whether you are schooling or working) as well as the cost of working instead of
schooling.
Explicit cost: The dollars sacrificed and actually paid out for a choice.
Implicit cost: The value of something sacrificed when no payment is made.
Four Resources (resources are the most basic elements to make goods and
services)
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Labour: the time humans spent producing goods and services.

Capital: any long-lasting tool, that itself produced, and helps us make
other goods and services
o Physical capital: includes machinery, equipment, hand tools, factory
buildings and computers.
o Human capital: skills and knowledge possessed by workers.
o Capital stock: the total amount of capital at a nations disposal.
Land: the physical space on which production takes place as well as the
resources found under or on it.
Entrepreneurship: the ability to combine the other resources into a
productive enterprise.

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Production possibilities frontier (PPF) is a curve showing all combinations of
two goods that can be produced with the resources and technology currently
available.
According to the law of opportunity cost, the more of something we produce, the
greater the opportunity cost of producing even more of it. Resources, by their
very nature, are better suited to some purposes than to others. As we begin
moving rightward along the PPF, a small amount of resources, those that are
least suited for wheat production, would be used for tank production. However,
further down the PPF, we are forced to shift resources that are more suited to
wheat than to tanks. Hence, the PPF becomes steeper.
Productively inefficient is a situation in which more of at least one good can
be produced without sacrificing the production of any other good. Economies do
not usually operate inside the PPF as it could mean that it is productively
inefficient or that it is in a recession as there might be large-scale
unemployment.

Chapter 3: