Economics — definition?
Study of choices under scarcity.
Limited resources — examples?
Land, labor, capital, time.
Economic agents — role?
Make decisions on resource allocation.
Micro vs macroeconomics — difference?
Micro: individual markets; macro: economy-wide.
Basic economic problem — cause?
Scarcity of resources versus unlimited wants.
Opportunity cost — definition?
Next best alternative foregone.
Rational decision process — steps?
Identify, evaluate, choose best option.
Engineering economics — focus?
Analyzing project costs and benefits.
Cost-benefit analysis — purpose?
Compare alternatives for best outcome.
Economic environment — influence?
Shapes project feasibility and priorities.
Scarcity — effect on choices?
Requires prioritization and trade-offs.
Economic agents — types?
Households, firms, government.
Microeconomics — focus?
Behavior of individual agents.
Macroeconomics — focus?
Overall economy indicators.
Every project — involves?
Economic decision-making and trade-offs.
Opportunity cost for firms?
Profit from next best alternative.
Rational decision-making — goal?
Maximize objectives systematically.
Engineering economics — tools?
NPV, ROI, payback period.
Cost-benefit analysis — key?
Quantifies trade-offs to select best option.
Economic environment — key factors?
Budget, societal needs, sustainability.
Answer 10 questions on Fundamentals of Economic Decision-Making.
1. What does economic decision-making primarily refer to?
2. According to the course content, which resource is explicitly mentioned as often having multiple alternative uses, requiring prioritization?
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