Key Takeaways
Lesson Description
Key Takeaways
• Economics studies how scarce resources are allocated to satisfy unlimited wants.
• Every economic decision involves trade-offs and opportunity costs.
• Comparative advantage explains why specialization and trade benefit all participants.
• Production Possibilities Curves (PPCs) illustrate scarcity, efficiency, and economic growth.
• Economic systems determine how societies answer the three economic questions: What to produce? How to produce? For whom to produce?
Must Know Models
Production Possibilities Curve (PPC)
Comparative Advantage Model
Must Know Vocabulary
Scarcity
Opportunity Cost
Trade-off
Comparative Advantage
Absolute Advantage
Specialization
Economic System
Factors of Production
Capital
Human Capital
AP Exam Focus
• Calculate opportunity cost.
• Identify comparative advantage.
• Interpret Production Possibilities Curves.