Introduction to Microeconomics Chapter 01 : Introduction
Chapter 1 is concerned with the subject, the purpose and the characteristics of economics. It explains that as a result of boundless human needs and limited resources, economics may be defined as the science studying how society manages its scarce resource. Economics shares with other sciences the scientific approach, the use of models and different levels of study. What differentiates it from natural sciences is the fact that economics cannot rely on laboratory tests for developing and verifying its theories. Chapter 1 explains one central economic model – the Production Possibilities Frontier and presents 7 assumptions about the economic behaviour of humans.
Prof. Dr. Hiltgunt Fanning (Fachhochschule Stralsund)