section 1

• Resources are the inputs required for the production of goods and services
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  • Land: natural resources like the surface of the earth, lakes, forests, etc.
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  • Scarcity forces choices due to limited resources
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  • Shows the maximum combination of two goods that can be produced with available resources
• • Scarcity is the lack of resources to satisfy all human wants and needs
• • Economic goods are scarce and have an opportunity cost, while free goods are abundant
• • Points on the curve are attainable, inside the curve is inefficient, outside is unattainable
• • Outward shift in PPC indicates economic growth, inward shift indicates economic shrinkage
• • Opportunity cost can be calculated from PPC diagrams to compare different decisions
• • Opportunity cost is the next best alternative given up when a choice is made
  • Examples illustrate opportunity cost in decision-making
• • Labour: human resources in terms of mental and physical efforts
• • Capital: man-made resources like tools and machinery
• • Enterprise: the ability to take risks and run a business venture
• Land: natural resources such as land or minerals
• Economic Growth: an increase in real GDP over time
• Economic growth refers to an increase in real GDP over time, which means that more goods and services are being produced.
• Inflation: general rise in prices across the economy