Introduction to Economics

Study of how individuals, businesses, and societies allocate limited resources to meet unlimited wants.

Microeconomics
- Focuses on individual agents and markets.
- Analyzes supply and demand, consumer behavior, and production costs.
Macroeconomics
- Studies economy-wide phenomena.
- Examines national income, overall employment, inflation, and economic growth.

Supply and Demand
- Law of Demand: Price increases lead to demand decreases.
- Law of Supply: Price increases lead to supply increases.
- Equilibrium: Point where supply equals demand.
Elasticity
- Measure of responsiveness of quantity demanded or supplied to changes in price.
- Types: Price elasticity, income elasticity, cross-price elasticity.
Opportunity Cost
- Cost of the next best alternative foregone when making a decision.
Market Structures
- Perfect Competition: Many firms, identical products.
- Monopoly: Single firm dominates, unique product.
- Oligopoly: Few firms, may collaborate or compete.
- Monopolistic Competition: Many firms, differentiated products.

Gross Domestic Product (GDP)
- Total value of goods and services produced in a country over a specific time period.
Unemployment Rate
- Percentage of the labor force that is unemployed and actively seeking employment.
Inflation Rate
- Rate at which the general level of prices for goods and services rises.

Classical Economics
- Believes in the self-regulating nature of markets.
Keynesian Economics
- Emphasizes active government intervention in the economy, especially during recessions.
Monetarism
- Focus on the role of governments in controlling the amount of money in circulation.
Behavioral Economics
- Examines psychological factors that influence economic decision-making.

Fiscal Policy
- Government adjustments in spending and tax rates to influence the economy.
Monetary Policy
- Central bank actions that manage the money supply and interest rates.

Trade Theories
- Comparative Advantage: Nations should specialize in producing goods where they have a lower opportunity cost.
Balance of Payments
- Record of all economic transactions between residents of a country and the rest of the world.

Supply and Demand Graph
- Illustrates the relationship between price and quantity in a market.
Circular Flow Model
- Shows how money and products flow through the economy between households and businesses.

Economics studies how individuals, businesses, and societies make choices when faced with scarcity. It focuses on allocation of limited resources to satisfy unlimited wants.

Microeconomics analyzes individual agents and markets, focusing on supply and demand, consumer behavior, and production costs.
Macroeconomics examines economy-wide phenomena, like national income, overall employment, inflation, and economic growth.

Supply and Demand describes the relationship between price and quantity.
- Law of Demand: As price increases, demand decreases.
- Law of Supply: As price increases, supply increases.
- Equilibrium is the point where supply and demand meet.
Elasticity measures the responsiveness of quantity demanded or supplied to changes in price.
- Price elasticity assesses how much demand or supply changes in response to price changes.
- Income elasticity measures the change in demand due to income variations.
- Cross-price elasticity analyzes how demand for one good changes based on price changes of another good.
Opportunity Cost represents the value of the best alternative foregone when making a decision.
Market Structures describe the competitive landscape of a market:
- Perfect Competition involves many firms selling identical products.
- Monopoly involves a single firm dominating the market with a unique product.
- Oligopoly has a few firms, potentially collaborating or competing.
- Monopolistic Competition features many firms selling differentiated products.

Gross Domestic Product (GDP) represents the total value of goods and services produced in a country within a given time period.
Unemployment Rate measures the percentage of the labor force actively seeking employment but unable to find it.
Inflation Rate indicates the rate at which prices for goods and services rise.

Classical Economics believes markets are self-regulating, driven by supply and demand forces.
Keynesian Economics emphasizes government intervention to manage economic fluctuations, particularly during recessions.
Monetarism focuses on the role of central banks in controlling the money supply.
Behavioral Economics explores psychological factors that influence economic decision-making.

Fiscal Policy involves government adjustments to spending and tax rates to influence the economy.
Monetary Policy refers to actions taken by central banks to manage the money supply and interest rates.

Trade Theories explain international trade patterns:
- Comparative Advantage suggests nations should specialize in producing goods where they have a lower opportunity cost.
Balance of Payments records all economic transactions between a country and the rest of the world.

Supply and Demand Graph visually represents the relationship between price and quantity in a market.
Circular Flow Model illustrates the flow of money and products between households and businesses within the economy.

Globalization and its impact on local economies and global interdependence.
Technology's role in shaping economic practices and creating new opportunities.
Economic Inequality and its effects on social mobility and wealth distribution.