Economics Concepts Of Macroeconomics

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Recommended: Economic scarcity and choice

Economics is a social science; investigating how people use limited resources to fulfill unlimited wants. Microeconomics study about individual decision making unit behavior, these unit included individual, households, business firms and government. Macroeconomics is study about the aggregate effects on national economy and the global economy that individual, households, business firms and governments make. The economics concepts that I had choose are scarcity, choice, demand and supply.

First of all, our inability to satisfy all the wants that we wanted is called scarcity. Normally scarcity will occurs when too much of demand but lack of supply, because lack of resources it also lead to a rational choice. For example, if Xiu Meng wanted …show more content…

He wanted to purchase a G-Shock watch which cost him RM500 and a Nike Huarche Ultra which cost RM650. So, he faced scarcity. He only can choose either one to purchase, whether he purchase G-Shock watch or Nike Huarche Ultra. He can’t purchase two in the same time because he have not enough resources- money. Tong Yong and his family have saved RM150,000 in 3 years and they wanted to purchase a Honda City which cost them RM100,000 and a Hyundai Sonata which cost them RM 120,000. They only have RM150,000 in total, so families faced scarcity. They only can choose either Honda City or Hyundai Sonata. They can’t get both in the same time because they don’t have enough resources - money. Ming own a company. He has RM150,000 in total. He wanted to expand his own company to Korea and purchase the latest technology from US for his company to increase the productivity. Which cost him RM130,000 and RM100000. He has not enough resources to fulfill his wanted at the same time so, firms faced scarcity in his firms. In years 2016 government decided to allocate RM500,000,000 from taxes on infrastructural. If government wanted to build LRT stations in every city and public hospital in unorganized area, it will cost RM450,000,000 and RM400,000,000. government have not enough resources to build two in the same time therefore, government faced scarcity and he must make a rational choice.

J&J Societies have RM 500,000 in total and they wanted to build nursing home and treatment center. Build nursing home cost RM450,000 and building treatment center cost RM 500,000. J&J Societies have only RM500,000 so, they can’t run the project in the same time therefore, scarcity occurs in

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