ABSTRACT
This chapter introduces you to the basic concepts that underlie the study of economics. It first defines what is meant by “economics in context” by distinguishing between intermediate and final goals. Specific economic goals are discussed, including economic efficiency and human well-being. The four essential economic activities are introduced: resource management, the production of goods and services, the distribution of goods and services, and the consumption of goods and services. Economic tradeoffs are illustrated graphically using production-possibilities frontiers. Finally, a contrast is made between the traditional economic model and an “in context” approach that recognizes social and environmental realities.
