Economics is the study of the choices that society makes to satisfy wants and needs.
Economics is based on the concept of scarcity, or limited resources, to meet unlimited wants.
The concept of the invisible hand of the market states that if individuals do what is best for themselves, they do what’s best for society at the same time.
With a trade-off, something is given up to get something else. For example, there is no such thing as a free lunch because a resource (time) is given up to take advantage of the offer.
Decisions are made by weighing the benefits and cost of every choice.
The cost of something is what is given up to get it.
Adam Smith, author of The Wealth of Nations, is considered the father of modern economics.
Opportunity cost is the next-best possible alternative that is given up when a decision is made.
Firms and individuals act in their own best interest in a market economy.
Command and capitalist economies are the two major types of economic systems.
Market (capitalist) economies are more effective than centralized (command) economies.
Trade allows a country to consume more of a particular item than it can produce.

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