Notesale: Turn your study into money

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Economics is a field of study that examines the production, distribution, and
consumption of goods and services
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These principles of
economics have practical applications that extend beyond the traditional realm of
academic inquiry and have real-world implications for individuals, businesses, and
governments
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This
principle recognizes that resources are limited, and therefore, choices must be
made about how to allocate those resources
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For example, when a person decides to spend their money on a new TV,
they are choosing to forgo the opportunity to spend that money on something
else, such as a vacation or saving for retirement
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Businesses also face the challenge of scarcity as they make decisions about
how to allocate their resources, such as labor, capital, and raw materials
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Another important principle of economics is that of supply and demand
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When the demand for a good or service
increases, but the supply remains constant, the price will rise
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Understanding the principle of supply and demand has practical
implications for businesses as they set prices for their products and services
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On the other hand, if a
business produces a product that is in low demand, they may choose to lower the
price in order to stimulate sales
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For example, a consumer may choose
to wait to buy a product until the price falls, or they may choose to buy a product
from a different seller who offers a lower price
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Elasticity measures the
responsiveness of demand or supply to changes in price or income
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For example, the demand for essential goods, such
as food and medicine, tends to be inelastic, as consumers will continue to
purchase these goods regardless of price changes
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For example, the demand for luxury goods, such as
designer clothing and high-end electronics, tends to be elastic, as consumers will
be less likely to purchase these goods if the price increases
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For example, a business that produces a
good with elastic demand may choose to lower the price in order to stimulate
sales, while a business that produces a good with inelastic demand may choose to
raise the price to maximize profits
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This principle recognizes that individuals, businesses, and countries
can benefit from specializing in the production of goods and services in which
they have a comparative advantage

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