Economics is about choice and the impact of our choices on each other. It relates to every aspect of our lives, from the decisions we make as individuals or family units to the structures created by businesses and governments.

It is a social science, that is, it is a study of people. Specifically, it is the study of how people use their limited resources to satisfy their unlimited wants.

The situation when there are unlimited wants and only limited resources to satisfy them is called scarcity. Economics is thus the study of scarcity.

Resources are whatever is used to satisfy wants. As people are unable to satisfy their unlimited wants with only limited resources at their disposal they must choose which wants to satisfy.

With every choice there is a next best alternative not chosen. This is known as the opportunity cost of the decision.