About This Chapter
Scarcity, Choice & The Production Possibilities Curve - Chapter Summary
The video lessons in this chapter can help students learn about the factors that affect the production of goods as well as how to use the production possibilities curve. Watch our expert instructors as they explain scarcity, opportunity cost and efficiency. Also ask these instructors any questions you may have so you can master the material and gain an understanding of:
- Economics and the concept of scarcity
- Opportunity cost and how it's calculated
- Finding the most efficient way to produce a combination of multiple goods
- Shifts in the production possibilities curve
- How different economic systems answer the three basic questions of economics
- Factors that affect production
- Using the production possibilities curve to show trade-offs and economic efficiency and inefficiency
Following each video lesson, take lesson quizzes to reinforce the material you have learned and discover what topics you may want to review. Use the timelines to go directly to main points in the video lessons, or read over the lesson transcripts to fortify your comprehension of these topics.
1. Economic Scarcity and the Function of Choice
Discover the foundation of the social science of economics as we explore the basic economic problem of scarce resources and unlimited wants using key definitions that create a framework for understanding everyday behavior in a nation.
2. Opportunity Cost: Definition & Real World Examples
Learn the most important concept of economics through the use of real-world scenarios that highlight both the benefits and the costs of decisions. Opportunity cost is a simple yet powerful principle that reveals how to make the best economic decisions possible, and it explains why people make the choices they do.
3. How to Calculate Opportunity Cost
Learn the formula that reveals the economic value in any major choice between two possibilities. Every choice involves tradeoffs, and opportunity cost shows you how to measure these tradeoffs.
4. Applying the Production Possibilities Model
Producers in the economy use a visual model, called the production possibilities curve, to make the most efficient production decisions and maximize output. Learn how this model reveals the tradeoffs of every production decision with the simplified example of an economy that produces only two goods.
5. Shifts in the Production Possibilities Curve
In this lesson you will learn how changes inside an economy lead to changes in the production possibilities of a nation. See how different scenarios from everyday life lead to shifts in the production possibilities curve.
6. Production in Traditional, Market, Command & Mixed Economic Systems
This lesson discusses how market, traditional, mixed, and command economic systems operate. The key features, benefits, and drawbacks of each are summarized. Learn how the economic systems answer the three basic economic questions that face all economies.
7. Factors of Production: Definition & Examples
There are four factors of production. The four factors are inputs needed to produce a product or provide a service. These factors include natural resources, human resources, capital, and entrepreneurship.
8. Using the Production Possibility Curve to Illustrate Economic Conditions
This lesson explains the economic concept of the production possibility curve, which is used to illustrate conditions and make good business decisions. Trade-offs, economic efficiency, economic inefficiency, and economic growth are explained.
Earning College Credit
Did you know… We have over 200 college courses that prepare you to earn credit by exam that is accepted by over 1,500 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.
To learn more, visit our Earning Credit Page
Transferring credit to the school of your choice
Not sure what college you want to attend yet? Study.com has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.
Other chapters within the GACE Economics (538): Practice & Study Guide course
- Basic Economic Concepts & Terms
- Comparative & Absolute Advantage, Specialization & Trade
- Supply, Demand & Market Equilibrium
- Determining Price in Economics
- Government Issues in Economics
- Business Organization & Decision Making
- Producers & Production in Microeconomics
- Understanding Macroeconomic Equilibrium
- Scarce Economic Resource Markets Basics
- Economic Market Structures
- Basics of Measuring the Economy
- Understanding Economic Growth and Productivity
- Inflation & Adjustment in Economics
- Unemployment Basics
- Understanding Inflation & Unemployment
- Overview of Aggregate Demand & Supply
- Fiscal Policy & Monetary Policy
- Expansionary & Contractionary Gaps
- Money & the Market
- The Central Bank & Monetary Policy
- Foreign Exchange & Trade Balance
- Overview of Inflows, Outflows & Restrictions
- Personal Finance: Consumer Decision Making
- Personal Finance: Savings & Investments
- GACE Economics Flashcards