Ch 111: Understanding Basic Economics Terms & Concepts

About This Chapter

Increase what you know about basic economic terms and concepts by studying this chapter. You can use these lessons to learn about different functions of economics and how they're applied.

Understanding Basic Economics Terms & Concepts - Chapter Summary

Get ready to learn more about basic terms and concepts of economics. Build your understanding of different economic systems with this chapter. These lessons will help you study:

  • Differences between microeconomics and macroeconomics
  • Limitations of capitalism and the free market
  • Applications of economic scarcity and the function of choice
  • Opportunity cost and how it's calculated
  • The production possibilities model and the production possibilities curve

The economic information in this chapter will be presented to you in the form of short, informative videos. Transcripts are included with each lesson if you'd like to view these terms from another perspective. You can complete our self-assessment quizzes to ensure you've gained an understanding of these economic concepts.

8 Lessons in Chapter 111: Understanding Basic Economics Terms & Concepts
Test your knowledge with a 30-question chapter practice test
What is Economics? - Definition & Types

1. What is Economics? - Definition & Types

Few things affect the day-to-day lives of everyone more than the economy. In this lesson, you'll learn about economics, including some of its foundational topics and concepts. You'll also have a chance to take a quiz after the lesson.

Microeconomics vs. Macroeconomics

2. Microeconomics vs. Macroeconomics

In this lesson, we learn how economics touches every aspect of human life. Focusing on the central ideas of scarcity and utility, we see how economics plays out in its two largest fields, microeconomics and macroeconomics.

Capitalism and the Free Market: Definition & Limitations

3. Capitalism and the Free Market: Definition & Limitations

Capitalism is an economic system that has played a dominant part in building the world in which we currently live. In this lesson, you'll learn about some key concepts of capitalism, as well as its limitations.

Economic Scarcity and the Function of Choice

4. 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.

Opportunity Cost: Definition & Real World Examples

5. 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.

How to Calculate Opportunity Cost

6. 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.

Applying the Production Possibilities Model

7. 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.

Shifts in the Production Possibilities Curve

8. 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.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
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Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
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