Class: Introduction to Economics

Date: April 2, 2024

Topic: Basic Economic Concepts

Key Concepts Covered:

1. Scarcity and Choice:

 Definition of scarcity: Limited resources versus unlimited wants.
 Opportunity cost: The value of the next best alternative forgone when a
choice is made.
2. Supply and Demand:
 Law of Demand: Inverse relationship between price and quantity
demanded.
 Law of Supply: Positive relationship between price and quantity supplied.
 Equilibrium: Point where supply equals demand, determining market price
and quantity.
3. Elasticity:
 Price elasticity of demand: Measures the responsiveness of quantity
demanded to changes in price.
 Income elasticity of demand: Measures the responsiveness of quantity
demanded to changes in income.
 Cross-price elasticity of demand: Measures the responsiveness of quantity
demanded of one good to changes in the price of another good.
4. Market Structures:
 Perfect competition: Many buyers and sellers, homogeneous products, no
barriers to entry.
 Monopoly: Single seller, unique product, significant barriers to entry.
 Oligopoly: Few sellers, differentiated or homogeneous products,
interdependence among firms.
5. Gross Domestic Product (GDP):
 Definition: Total market value of all final goods and services produced
within a country's borders in a given period.
 Components: Consumption, investment, government spending, and net
exports.
 Nominal vs. Real GDP: Real GDP adjusted for inflation to reflect changes in
purchasing power over time.

Additional Notes:
  Discussed the role of government intervention in regulating markets, addressing
externalities, and promoting competition.
 Examined current economic indicators and trends, such as unemployment rates,
inflation rates, and GDP growth.
 Reviewed case studies illustrating the application of economic principles to real-
world scenarios, including pricing strategies, labor markets, and international
trade.

Next Class:

 Topic: Macroeconomic Concepts and Policies

 Assigned Reading: Chapters 1-3 in the textbook.