Economics Basics

After observing the society, he noted that there was an "invisible hand" turning the wheels of the economy.

"An Inquiry into the Nature and Causes of the Wealth of Nations" was written by

It relies on the government making decisions as to how resources are going to be used

Economics makes the assumption that human beings will aim to fulfill their self-interests.

Economics is

He is considered the father of modern economics

"An Inquiry into the Nature and Causes of the Wealth of Nations" tries to understand

Economics has been referred as the _______ science

It advocates for a competitive market, to determine how resources should be allocated

Economics is all about making choices

As an individual, you face the problem of having only limited resources with which to fulfill your wants and needs.

Scarcity and unlimited wants force governments and individuals to decide how to manage resources better

Economics is trying to understand how individuals and countries behave in response to certain material constraints

It looks at the total output of a nation and the way the nation allocates its limited resources

Resources of a country

There are no limits to what the economy and government can do.

It refers to the tension between our limited resources and our unlimited wants and needs

Macro and microeconomics are intertwined

Economics assumes that individuals are rational in their efforts to fulfill their unlimited wants and needs

Resources of an individual

Microeconomics shows us how individuals and firms respond to changes in price

It studies the allocation and use of resources but on the level of the individual people and firms within the economy