1. The Core Problem: Scarcity and Unlimited Wants★☆☆☆☆⏱ 3 min
Scarcity is a universal condition that affects all societies, regardless of their level of development or income. Even the wealthiest countries have limited factors of production (land, labor, capital, entrepreneurship) to produce goods and services, so all societies must make choices about what to produce.
2. The Core Definition of Economics★☆☆☆☆⏱ 4 min
The entire discipline of economics exists because scarcity forces choice: if resources were unlimited and all wants could be satisfied, there would be no need to study allocation decisions. IB exam mark schemes explicitly require both scarcity and unlimited wants to be included in a full definition of economics.
3. Microeconomics vs Macroeconomics★★☆☆☆⏱ 3 min
IB Economics splits the study of the discipline into two core branches, which are covered separately throughout the course. The key difference between the two is the scope of analysis: individual units vs the entire economy.
Common Pitfalls
Why: Scarcity is a universal condition caused by unlimited wants relative to limited resources, not low income.
Why: IB exam mark schemes require both core elements of the definition to award full marks.
Why: Government intervention can happen in individual markets, which is still a microeconomic topic.
Why: Economics is a social science that studies all choices made under scarcity, including non-market choices.