ECON 101
Week 1
Lecture 1
Key Concepts in Economics
Instructor: Predrag Rajsic
Agenda
Getting Started
What is economics all about?
Pop Quiz
This will NOT be marked
Write on a piece of paper what you think economics is
all about
And for those of you who have Top Hat, lets try it out.
Definition of Economics
Standard Definition:
Economics is the social science that studies the choices
that individuals, businesses, governments, and entire
societies make as they cope with scarcity and the
incentives that influence and reconcile those choices.
Definition of Economics
Microeconomics is the study of choices that individuals
and businesses make, the way those choices interact in
markets, and the influence of governments.
An example of a microeconomic question is: Why are
people buying more e-books and fewer hard copy books?
Land
Labour
Capital
Entrepreneurship
An Example
Your neighbour has a bakery
Land
Labour
Capital
Entrepreneurship
A choice is a tradeoff.
People make rational choices by comparing benefits
and costs.
Other term for rational is purposeful
Benefit is what you gain from something.