We usually decide based on the "next" unit. (e.g., "Is the extra hour of sleep worth the extra stress of being late?"). 2. Macroeconomics (The Big Picture)
Economists split the world into two main views to understand how we function: 1. Microeconomics (The Small Scale) Focuses on how individuals and businesses make decisions.
To create anything for "us" to consume, we need four ingredients: Natural resources (water, oil, minerals). Labor: The effort and skills people provide. Capital: The tools and machinery used to make other things.
How our willingness to buy (demand) and a business's ability to sell (supply) determine the price of everything from coffee to iPhones.
Focuses on how we perform collectively as a nation or the world. The total value of everything we produce.
Economics is essentially the study of how manage limited resources to satisfy unlimited wants.
Since we can’t have everything, every choice has a cost—the value of the "next best thing" you gave up.
