Summary

Summary IB HL Micro Economics Notes

98 views 0 purchase

Course
Economics

Institution
12th Grade

These notes provide an in depth level of content on micro economics. With these notes I was able to achieve a 6 in HL economics which is equivalent to a 96%.

[Show more]

Preview 4 out of 35 pages

View example

Uploaded on July 23, 2024
Number of pages 35
Written in 2023/2024
Type Summary

Institution Secondary school
Education 12th Grade
Course Economics
School year 4

CA$3.49

Also available in package deal from CA$12.49

Added

Add to cart Add to wishlist

100% satisfaction guarantee
Immediately available after payment
Both online and in PDF
No strings attached

Also available in package deal (1)

Economics Package

CA$ 12.97 CA$ 12.49 3 items

1. Summary - Ib hl micro economics notes
2. Summary - Ib hl macro economics notes
3. Summary - Hl ib international trade economic notes
Show more

Microeconomics Notes

Microeconomics

Concepts to study ● Demand And Supply
● Market Equilibrium
● Behavioural Economics
● PED, YED
● PES
● Government Roles
● Market Failure

Notes

Basics
Factors of Production:
1. Land - This includes the land itself, everything that is under and above the land and everything that is found in and under the sea.
Therefore, this category encompasses all natural resources, such as minerals, oil reserves, natural gas, forests, rivers and lakes.
2. Labour - This is the human factor needed for production. It includes the physical and mental effort that people contribute to the
production of goods and services.
3. Capital - This is the physical capital stock used to produce goods and services. It includes all manufactured (human-made) resources,
such as machines, factories, roads and tools. Physical capital is also referred to as capital goods or investment goods.
4. Entrepreneurship - This is a special human skill, possessed by some people, involving the ability to develop new businesses by
organizing the other three factors of production – land, labour and capital – to produce goods and services, and taking the risks of
success or failure of the business, as profit is not guaranteed and investment may be lost.
Remember “CELL”

Opportunity Cost = The next best alternative that is given up when an economic decision is made.

,Free Market Economy
● Resources are privately owned by people and firms.
● All economic decisions are made by consumers and producers through the price mechanism.

Production Possibility Curve Model (PPC)
The model illustrates an imaginary economy that produces only two goods. These goods are produced with a combination of the available
resources that the country has, using the actual state of technology at a specific moment in time. The maximum combinations of goods and
services that the country can produce are drawn on the production possibility curve as shown on Figure 1.

Circular Flow of the Economy

,In this simple two-sector model, households are the owners of all factors of production and offer them to firms in exchange for an income.
Firms hire and organize these factors to produce goods and services, which are then consumed by households.
Households provide the factors of production: land, labor, capital and entrepreneurship. In exchange for their services, firms will pay for each
of these factors of production in different ways:
● For land, they will pay rent.

, ● For labor, they will pay wages.
● For capital, they will pay interest.
● For entrepreneurship, they will pay dividends.
NATIONAL INCOME = NATIONAL OUTPUT = NATIONAL EXPENDITURE

Demand Definition: The quantity demanded of a good or service, that consumers are willing and able to buy at various prices, ceteris paribus

The law of demand: The principle that as price increases the quantity demanded of a product will decrease.

3 Reasons Demand is Negative sloping: Assumptions of demand (HL)
1. Income Effect

When price of a product falls, and consumers income stay the same, we can assure quantity demanded increases ( Price ↓, Real Income ↑ - ↑
Quantity demanded)
2. Substitution effect
When consumers substitute relatively lower -priced goods
- As price increases, goods become more expensive, so consumers buy substitutes to save money
- As price falls, the good becomes relatively cheaper than it’s substitutes, do some consumers buy it in place of the substitutes

3. Law of decreasing marginal utility
Marginal Utility = the benefit gained from consuming one
additional unit of goods and services.
The principle that as additional units of a good or service are
consumed, the marginal utility will decline

Factors Affecting Demand:
- Price
- Advertising
- Price of complements
- Price of substitutes
- Interest rates
- Taxes ( direct)

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller laurengori. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for CA$3.49. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

64438 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 14 years now

Start selling