 The social science concerned with the efficient use of limited or scarce resources to achieve maximum satisfaction of human economic wants.

 Wants: limitless and varied: golf clubs, television, Nintendo, college degree.  Needs (a subset of wants): clean air, clean water, food, shelter, clothing.

 The big picture: analyzing economy-wide phenomena such as unemployment, inflation, and growth.

 The study of the individual pieces that together make an economy. Microeconomics considers issues such as how households reach decisions about CONSUMPTION and SAVING, how FIRMS set a PRICE for their OUTPUT, whether PRIVATISATION improves EFFICIENCY, whether a particular market has enough COMPETITION in it and how the market for LABOUR works.

 The true cost of something is what you give up to get it. This includes not only the money spent in buying (or doing) the something, but also the economic benefits (UTILITY) that you did without because you bought (or did) that particular something and thus can no longer buy (or do) something else. ECONOMICS is primarily about the efficient use of scarce resources, and the notion of opportunity cost plays a crucial part in ensuring that resources are indeed being used efficiently.

 STUFF WE WANTProducts can be classified into goods and services. Goods are items that are tangible, such as books, pens, salt, shoes, hats and folders. Services are intangibles provided by other people, such as doctors, lawn care workers, dentists, barbers and waiters.

 What consumers do. Within an economy, this can be broken down into private and public consumption (see PUBLIC SPENDING). The more resources a society consumes, the less it has to save or invest, although, paradoxically, higher consumption may encourage higher INVESTMENT. The LIFE-CYCLE HYPOTHESIS suggests that at certain stages of life individuals are more likely to be saving than consuming, and at other stages they are more likely to be heavy consumers. Some economists argue that consumption taxes are a more efficient form of TAXATION than taxes on wealth, CAPITAL, property or INCOME.

Supplies of the FACTORS OF PRODUCTION are not unlimited. This is why choices have to be made about how best to use them, which is where ECONOMICS comes in.

 Land (resource)  Labor (resource)  Capital (resource)  Entrepreneurial ability (resource) aka Enterprise

 One of the FACTORS OF PRODUCTION, along with LABOUR, CAPITAL and ENTERPRISE. Pending colonization of the moon, it is in fairly fixed SUPPLY.  Includes NATURAL RESOURCES (a material source of wealth, such as timber, fresh water, or a mineral deposit, that occurs in a natural state and has economic value. Ig timber, water, minerals.)

 One of the FACTORS OF PRODUCTION, with LAND, CAPITAL and ENTERPRISE. THE EFFORT OF WORKERS. Among the things that determine the supply of labor are the number of able people in the POPULATION, their willingness to work, labor laws and regulations, and the health of the economy and FIRMS. DEMAND for labor is also affected by the health of the economy and firms, labor laws and regulations, as well as the PRICE and supply of other factors of production.

 A FACTOR OF PRODUCTION, along with LAND, LABOUR and ENTERPRISE. Includes buildings, machinery, tools, and all other manufactured goods used to make other goods and services. Production processes that use a lot of capital relative to labor are CAPITAL INTENSIVE; those that use comparatively little capital are LABOUR INTENSIVE.

 The life and soul of the capitalist party. When someone has the idea and ENTERPRISE to mix together the other FACTORS OF PRODUCTION to produce something valuable (organization of resources for production). An entrepreneur must be willing to take a RISK and INNOVATE in pursuit of a PROFIT.

 The stuff that enables people to earn a living. Human capital can be increased by investing in education, training and health care.

 The world’s stocks of natural assets which include geology, soil, air, water and all living things.

 Paying for goods or services with other goods or services, instead of with money.

 Getting the most out of the resources used

 A curve depicting all maximum output possibilities for two or more goods given a set of inputs (resources, labor, etc.). The PPF assumes that all inputs are used efficiently.