MICROECONOMICS

Scarcity
1. Unlimited needs and wants
2. Limited resources
Production possibility diagram (PPF)
1. Living standards
  1. Material
    1. Tangible
      1. Goods
  2. Non-Material
    1. Non- Tangible
      1. Happeniss
      2. Freedom
2. 3 Types of Resources
  1. Natural
  2. Labour
  3. Capital
3. Opportuity cost
  1. Resource allocation
4. Equilibrium Price
Allocation of resources
1. Efficency
  1. PPF
Economic systems
1. Consumer Sovereignty
  1. Communist
  2. Capitalist
2. Demand
  1. Law of Demand
  2. Demand Elasticity
    1. Relatively Elastic
    2. Unit Elasticity
    3. Relatively Inelastic
    4. Needs VS Wants
  3. Factors
    1. Employment/ purchasing power
    2. Consumer confidence
    3. Interest Rates
3. Supply
  1. Law of Supply
  2. Supply Elasticity
    1. Relatively Elastic
    2. Unit Elasticity
    3. Relatively Inelastic
  3. Factors
    1. Production costs/ time
    2. Australian $
    3. Business condience
Market Failure
1. Externalities
  1. Positive
    1. Vaccinations
    2. Painting House
  2. Negative
    1. Smoking- Health system
    2. Pollution
2. Asymmetric Information
3. Market Power
  1. Monopoly
4. Underproduction desirable G/S
5. Over production of Undesirable G/S
6. Managing Market Failure
  1. Reducing tariffs
  2. Deregulation of markets
  3. Access to information
  4. Laws
Market price mechanism
1. 1- Relative Scarcity
2. 2- Relative Prices
3. 3- Relative Profitability
4. 4- Ållocation to be profitable
Market Structures
Economic Questions
1. 1- What and how much to produce?
2. 2- How much to produce?
3. 3- For whom to produce?

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MICROECONOMICS

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	Created by Nathan Hick over 9 years ago