Thomas Sowell - Basic Economics:
Chapter 1: What is Economics?
“The fundamental principles of economics are not hard to understand, but they are easy to forget, especially amid the heady rhetoric of politics and the media.” In Chapter 1 of Basic Economics, Thomas Sowell introduces the concept of economics, scarcity, and productivity:
Economy – a system for the production and distribution of the goods and services we use in everyday life
Economics – the study of the use of scarce resources which have alternative uses
Scarcity – the wants of everyone add up to more than what exists; without scarcity, there would be no need for economics
Productivity – the effectiveness of effort as measured at the rate at which inputs are turned into outputs
Role of Economics – helps us try to make decisions that make the most of the options that we are presented with in life, especially when allocating resources
Chapter 2: The Role of Prices
In Chapter 2 of Basic Economics, Thomas Sowell discusses the importance of prices and shows how resources are allocated:
Market Economy – an economic system in which production and prices are determined by unrestricted competition between individuals and businesses, not central planners
Transactions – the instance of buying or selling between consumers, producers, retailers, landlords, or workers on whatever terms they can mutually agree on
Prices – an amount of money that conveys the terms of the transaction not just to the individuals immediately involved but throughout the entire economic system
Supply – the tendency of producers to supply more at a higher price and less at a lower price; the quantity supplied varies directly with the price
Demand – the tendency of consumers to buy more at a lower price and less at a higher price; the quantity demanded varies indirectly with the price
Link: https://theprocesshacker.com/blog/basic-economics-thomas-sow...