| • Scarcity | refers to the condition in which human wants and needs exceed the available resources necessary to satisfy them. |
| • Opportunity costs: | refers to the value of the next best alternative that must be given up in order to pursue a certain decision or action. In other words, it is the cost of the foregone opportunity. |
| are opportunity costs monetary? | no, It can also refer to the time, effort, and other resources that must be given up in order to pursue a certain decision. |
| o Marginal benefits | are the additional benefits or utility gained from consuming or producing one additional unit of a good or service, while holding other factors constant. |
| o Marginal costs: | Marginal costs refer to the additional cost incurred from producing one additional unit of a good or service, while holding other factors constant. |
| For an activity to be worth it, marginal benefits must exceed the... | marginal costs (MB>MC) |
| MC > MB means; | It is no longer worth continuing with the activity since MC are greater than MB. |
| what is the optimal point? | The optimal point, also known as the point of equilibrium, is the point at which the marginal benefits of consuming or producing a good or service are equal to the marginal costs of producing that good or service |
| At the optimal point, any additional units of the good or service that are produced or consumed would result in a ..... in overall benefit or utility, because the additional .... would outweigh the additional .... | At the optimal point, any additional units of the good or service that are produced or consumed would result in a decrease in overall benefit or utility, because the additional costs would outweigh the additional benefits. |
| what is the equilibrium? | the optimal point is the point at which the most value or benefit can be obtained from consuming or producing a good or service, given the available resources and technology. |
| Factors of production refer to; | the resources and inputs that are used in the production process to create goods and services. These resources are combined in various ways by businesses to produce the goods and services that people want and need. |
| The four factors of production are: | o Land:
o Labor:
o Capital:
o Entrepreneurship: |
| land refers to | This refers to all natural resources used in the production process, such as soil, water, forests, minerals, and other resources that are found in nature. |
| o Labor: | This refers to the human effort, skills, and abilities used in the production process, including both physical and mental work. |
| o Capital | This refers to the tools, machinery, equipment, and other man-made resources used in the production process, such as buildings, vehicles, and computers. |
| o Entrepreneurship | This refers to the innovation, creativity, and risk-taking involved in the production process, including the ability to bring together the other factors of production to create a new product or service. |
| what are Positive Statements: | These are facts. It Including descriptions, theory development and theory testing. They are objective with no judgment. |
| what are Normative Statements: | These are not facts. They are what ought to be. Value judgments, should-would-could-ought to be. These are subjective statements. |
