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Chapter 1 – Introduction to Economics

All the things we choose & do in the economic world is made up from our self-interest.

Economics is a social study that studies the choices individuals, businesses and entire societies make as
they cope with scarcity and the incentives that influence those choices.

ً‫االلتصاد هو دراسة اجتماعٌة تدرس الخٌارات التً ٌتخذها األفراد والشركات والمجتمعات بأكملها فً تعاملهم مع الندرة والحوافز الت‬
.‫تؤثر على تلن الخٌارات‬

Scarcity – our inability to get everything we want. We want more than we can get.

‫ نرٌد أكثر مما ٌمكننا الحصول علٌه‬.‫الندرة – عدم لدرتنا على الحصول على كل ما نرٌد‬

Incentive – something that encourages or discourages an action.

‫الحافز – وهو أمر ٌشجع أو ٌثبط العمل‬.

Goods – physical objects

Service – actions performed by people

Economics is about (free) choices lead to exchanges on markets. Those exchanges lead to what,
how and for whom we produce.

Microeconomics

Study of choices that individuals and businesses make.

Choice -> Trade-off ->Rational -> Cost vs. Benefit

.‫دراسة االلتصاد الجزئً للخٌارات التً ٌتخذها األفراد والشركات‬

‫>التكلفة > ممابل الفائدة‬- ‫> المفاضلة‬- ‫االختٌار‬

Macroeconomics

Study of choices being made in the national economy and the global economy.

ً‫دراسة االلتصاد الكلً للخٌارات التً ٌتم اتخاذها فً االلتصاد الوطنً وااللتصاد العالم‬.
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Factors of production goods & services

*Land, natural resources.

*Labour , the time people devote on producing goods and services.

*Capital , tools businesses use to produce goods and services

*Entrepreneurship , new ideas and human resources of people

‫عوامل اإلنتاج السلع والخدمات‬

.‫* األراضً والموارد الطبٌعٌة‬

.‫ والولت الذي ٌكرسه الناس على إنتاج السلع والخدمات‬، ‫* العمل‬

‫ وأدوات الشركات استخدامها إلنتاج السلع والخدمات‬، ‫* رأس المال‬

‫ واألفكار الجدٌدة والموارد البشرٌة للناس‬، ‫* رٌادة األعمال‬

Chapter 2 – economic proplem

PPC (production possibility curve): a graph that shows the relationship between the quantity of one
good that can be produced for every possible level of production of another good.

‫ رسم بٌانً ٌوضح العاللة بٌن كمٌة واحدة جٌدة التً ٌمكن إنتاجها لكل مستوى ممكن من اإلنتاج من جٌد‬:)‫ (منحنى إمكانٌة اإلنتاج‬PPC
.‫آخر‬

Efficiency - A broad term that implies an economic state in which every resource is optimally allocated
to serve each person in the best way while minimizing waste and inefficiency. When an economy is
economically efficient, any changes made to assist one person would harm another. In terms of
production, goods are produced at their lowest possible cost, as are the variable inputs of production.

‫ مصطلح واسع ٌعنً حالة التصادٌة ٌتم فٌها تخصٌص كل مورد على النحو األمثل لخدمة كل شخص بأفضل طرٌمة مع تملٌل‬- ‫الكفاءة‬
‫ فإن أي تغٌٌرات ٌتم إجراؤها لمساعدة شخص ما من شأنها أن‬،‫ وعندما ٌكون االلتصاد فعاال من الناحٌة االلتصادٌة‬.‫الهدر وعدم الكفاءة‬
.‫ وكذلن المدخالت المتغٌرة لإلنتاج‬،‫ تنتج السلع بألل تكلفة ممكنة‬،‫ وفٌما ٌتعلك باإلنتاج‬.‫تضر بشخص آخر‬

Trade-off – giving up one thing for another.

.‫المفاضلة – التخلً عن شًء واحد آلخر‬

The principle of increasing opportunity cost (also called: Low-hanging-fruit principle): When resources
have different opportunity costs, we should always exploit the resource with the lowest opportunity
cost first, and afterwards use the resources with higher opportunity cost (picking the most accessible
fruit first).

‫ ٌنبغً لنا‬،‫ عندما ٌكون للموارد تكالٌف فرصة مختلفة‬:)‫ مبدأ الفاكهة المنخفضة المعلمة‬:‫مبدأ زٌادة تكلفة الفرصة البدٌلة (وٌسمى أٌضا‬
.)‫ وبعد ذلن استخدام الموارد بتكلفة فرصة أعلى (لطف الفاكهة األكثر سهولة أوال‬،‫دائما استغالل المورد بألل تكلفة فرصة أولى‬
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Shifts in the production possibilities curve are caused by changes in these things:
• Advances in technology
• Changes in resources
• More education or training (that's what we call human capital)
• Changes in the labor force
‫ • التمدم فً التكنولوجٌا • التغٌرات فً الموارد • المزٌد من‬:‫تحدث التحوالت فً منحنى إمكانٌات اإلنتاج بسبب التغٌرات فً هذه األمور‬
‫التعلٌم أو التدرٌب (وهذا ما نسمٌه رأس المال البشري) • التغٌرات فً الموى العاملة‬
The opportunity cost of any decision is what is given up as a result of that decision.
Opportunity cost includes both explicit costs and implicit costs. The firm’s economic profits
are calculated using opportunity costs. Accounting profits are calculated using only explicit
costs. Therefore, accounting profits are higher than economic profits.
‫ تشمل تكلفة الفرصة البدٌلة التكالٌف الصرٌحة والتكالٌف‬.‫وتكلفة الفرصة البدٌلة ألي لرار هً ما ٌتم التخلً عنه نتٌجة لذلن المرار‬
‫ ٌتم حساب األرباح المحاسبٌة باستخدام التكالٌف‬.‫ ٌتم حساب األرباح االلتصادٌة للشركة باستخدام تكالٌف الفرصة البدٌلة‬.‫الضمنٌة‬
.‫ فإن األرباح المحاسبٌة أعلى من األرباح االلتصادٌة‬،‫ ولذلن‬.‫الصرٌحة فمط‬

Chapter 3 – introduction macroeconomic

Gross Domestic Product (GDP) measures a country’s total income and expenditure.

.‫ٌمٌس الناتج المحلً اإلجمالً إجمالً دخل البلد ونفماته‬

The four spending components of GDP include: Consumption, Investment, Government Purchases, and
Net Exports.

.‫ االستهالن واالستثمار والمشترٌات الحكومٌة وصافً الصادرات‬:ً‫وتشمل مكونات اإلنفاق األربعة للناتج المحلً اإلجمال‬

Nominal GDP is measured using current prices.

.‫وٌماس الناتج المحلً اإلجمالً االسمً باستخدام األسعار الجارٌة‬

Real GDP is measured using the prices of a constant base year, and is corrected for inflation.

.‫ وٌتم تصحٌحه للتضخم‬،‫ٌتم لٌاس الناتج المحلً اإلجمالً الحمٌمً باستخدام أسعار سنة األساس الثابتة‬

GDP is the main indicator of a country’s economic well-being, even though it is not perfect

‫ على الرغم من أنه لٌس مثالٌا‬،‫الناتج المحلً اإلجمالً هو المؤشر الرئٌسً للرفه االلتصادي للبلد‬

GNP measures the value of goods and services produced by only a country's citizens but both
domestically and abroad.

.‫وتمٌس الناتج المومً اإلجمالً لٌمة السلع والخدمات التً ٌنتجها مواطنو البلد فمط ولكن محلٌا وخارجٌا‬
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Inflation reate is percentage increase in the overall price level

‫إعادة التضخم هً زٌادة النسبة المئوٌة فً المستوى العام لألسعار‬

Deflation is inflation rate is negative

Consumer price index (cpi) is average price of basket of goods and services purchased by consumers

‫االنكماش هو معدل التضخم هو مؤشر أسعار‬

‫) هو متوسط سعر سلة السلع والخدمات التً ٌشترٌها المستهلكون‬cpi( ً‫المستهلن السلب‬

GDP deflator =

Chapter 4 – unemployment
Young population : people below 15 years old

Working age population : from 15 to 64 years old

Old population : people aged 65 to above

Labor force : is the sum of employed and unemployed

Economically-Inactive Persons: are those individuals who are in the working-age population but not in
the labor force because they are (i) unable to work, or (ii) unwilling to work, or (iii) not actively seeking a
job.
‫ن‬ ‫ن‬ ‫رن‬
‫) ر‬1( ‫ هم األفراد الذين هم يف سن العمل ولكنهم ليسوا يف القوى العاملة ألنهم‬:‫النشطي اقتصاديا‬
،‫غي قادرين عىل العمل‬ ‫غي‬
‫األشخاص ر‬
.‫) ال يبحثون بنشاط عن عمل‬3( ‫ أو‬،‫اغبي ن يف العمل‬
‫غي ر ر ن‬
‫) ر‬2( ‫أو‬

Working-Age Population = Labor Force + Economically Inactive people

The Unemployed Persons: are those persons who are (i)) in the working-age population, (ii) able to
work, (iii) willing to work, (iv) actively seeking paid work, (v) but are involuntarily out of paid work
(neither full-time nor part time). In short, unemployed persons are in the labor force but are not
currently on full- or part-time paid work.
‫ن‬
‫' الذين يبحثون بنشاط‬4' ‫' المستعدون للعمل؛‬3' ‫' القادرون عىل العمل؛‬2' ،‫)) يف سن العمل‬1( ‫ هم األشخاص الذين هم‬:‫ العاطلون‬-1
‫العاطلي عن العمل يعملون ن يف قوة‬
‫رن‬ ‫ فإن‬،‫ وباختصار‬.)‫جزئ‬
‫ي‬ ‫' ولكنهم ال يعملون بأجر (ال بدوام كامل وال بدوام‬5' ،‫عن عمل مدفوع األجر‬
.‫جزئ‬
‫ي‬ ‫العمل ولكنهم ال يعملون حاليا بأجر كامل أو‬
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Chapter 5 – Demand
DEMAND

When demand increases, both price and the quantity increase. When demand decreases, both price and
the quantity decrease.

.‫ ٌنخفض السعر والكمٌة على حد سواء‬،‫ عندما ٌنخفض الطلب‬.‫ كل من السعر والكمٌة زٌادة‬،‫الطلب عند زٌادة الطلب‬

Law of demand: P↑ → Q(D)↓

Factors that change in demand

1. Prices of related goods

2. Expected future prices

3. Income

4. Expected future income

5. Population size

6. Preferences

ً‫ اإلٌرادات الدخل المتولع ف‬-4 ‫ الدخل‬.3 ‫ األسعار المستمبلٌة المتولعة‬.2 ‫ أسعار السلع ذات الصلة‬.1 ‫العوامل التً تتغٌر فً الطلب‬
‫ التفضٌالت‬.6 ‫ عدد السكان‬.5 ‫المستمبل‬

Demand Function

QD=f(P)

QD=a- b P

Where:

QD: quantity demanded.

a : the intercept which is the value of Qp when the price = 0. The value of a represents the maximum
quantity demanded.

b: the slope of demand function. It is the change in quantity demanded due to a one-unit change in
price.

b=

P : the price of the commodity.

Effects
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As the price of X increase QD of X Qd of other goods

Income effect Decreases Decreases
Substitution Effect Decreases Increases
Total Price Effect Decreases Undetermined

Chapter 6 – Supply
SUPPLY

When supply increases, the quantity increases and the price falls. When supply decreases ,the quantity
decreases and the price rises.

.‫ تنخفض الكمٌة وٌرتفع السعر‬،‫ عندما ٌنخفض العرض‬.‫ والزٌادة فً الكمٌة والسعر ٌنخفض‬،‫العرض عند زٌادة العرض‬

Law of supply: P↑ → Q(S)?

Factors bringing changes in supply:

1. Prices of factors of production

2. Prices of related goods produced

3. Expected future prices

4. Number of suppliers

5. Technology
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6. State of nature

‫ األسعار المستمبلٌة المتولعة‬.3 ‫ أسعار السلع ذات الصلة المنتجة‬.2 ‫ أسعار عوامل اإلنتاج‬.1 :‫العوامل التً تحدث تغٌٌرات فً العرض‬
‫ االنتعاش التكنولوجً حالة الطبٌعة‬-6 ‫ التكنولوجٌا‬.5 ‫ عدد الموردٌن‬.4

Supply Function

Qs=f(P)

Qs=c - d P

Where:

Qs: quantity supply.

c : the intercept which is the value of Qs when the price = 0.

d: the slope of supply function. It is the change in quantity supply due to a one-unit change in price.

d=

P : the price of the commodity

Chapter 7 – Market Equilibrium

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Market Equilibrium
Market is in equilibrium when D = S

Surplus when S > D

Shortage when D > S

Equilibrium price – price at which the

quantity demanded equals the
quantity supplied.

Equilibrium quantity – quantity bought and sold at the equilibrium price

Shift in demand due to complements:

- 2 goods are complements in consumption if an increase or decrease in the price of one causes a
leftward or rightward shift in the demand curve for the other

E.g. tennis racquets and balls, gin and tonic, printers and paper etc.

‫ السلع هً تكملة فً االستهالن إذا كان زٌادة أو انخفاض فً سعر واحد ٌسبب تحوال نحو الٌسار أو‬2 - :‫التحول فً الطلب بسبب تكملة‬
.‫ والطابعات والورق الخ‬،‫ والجن ومنشط‬،‫الٌمٌن فً منحنى الطلب على غٌرها من مضارب التنس والكرات‬

Shift in demand due to substitutes:

- 2 goods are substitutes in consumption if an increase or decrease in the price of one causes a
rightward or leftward shift in the demand curve for the other

E.g. beer and wine, coffee and tea etc.

‫ السلع هً بدائل فً االستهالن إذا كانت زٌادة أو انخفاض فً سعر واحد ٌسبب تحوال نحو الٌمٌن‬2 - :‫التحول فً الطلب بسبب البدائل‬
.‫أو الٌسار فً منحنى الطلب على اآلخر مثل البٌرة والنبٌذ والمهوة والشاي الخ‬

Shift in demand due to income change:

- normal good: demand curve shifts rightwards when the income of buyers increase and leftwards when
the incomes of buyers decrease

‫ ٌتحول منحنى الطلب نحو الٌمٌن عندما ٌزداد دخل المشترٌن وٌساره عندما تنخفض دخول المشترٌن‬:‫جٌد عادي‬
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- inferior good: demand curve shift leftwards when the income of buyers increase and rightwards when
the income of buyers decrease

 An increase in demand will lead to an increase in both, the equilibrium price and quantity.
 A decrease in demand will lead to a decrease in both, the equilibrium price and quantity.

- ً‫ منحنى الطلب التحول إلى الٌسار عندما ٌزٌد دخل المشترٌن والٌمٌن عندما ٌنخفض دخل المشترٌن زٌادة ف‬:‫أدنى جٌد‬
‫الطلب‬

.‫ وسعر التوازن والكمٌة‬،‫سٌؤدي إلى زٌادة فً كل من‬

‫ وسٌؤدي انخفاض الطلب إلى انخفاض فً كل من سعر التوازن والكمٌة‬.

Change in quantity supplied: a movement along the supply curve that occurs in response to a price
change

Change in supply: a shift of the entire supply change at the same price.

Shifts in supply:

 prices of inputs and their substitutes

 technological change, which means that there can be produced more with the same input
prices.
 number of firms in the market
 expected future prices
 weather (farming)

 An increase in supply will lead to a decrease in the equilibrium price and an increase in the
equilibrium quantity.
 A decrease in supply will lead to an increase in the equilibrium price and a decrease in the
equilibrium quantity.

‫ أسعار المدخالت وبدائلها‬:‫التحوالت فً العرض‬

.‫ مما ٌعنً أنه ٌمكن إنتاج المزٌد بنفس أسعار المدخالت‬،ً‫التغٌر التكنولوج‬

‫عدد الشركات فً السوق المتولعة‬

‫األسعار المستمبلٌة‬

)‫الطمس (الزراعة‬

.‫زٌادة فً العرض سٌؤدي إلى انخفاض فً سعر التوازن وزٌادة فً كمٌة التوازن‬

.‫وسٌؤدي انخفاض العرض إلى زٌادة فً سعر التوازن وانخفاض فً كمٌة التوازن‬
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Chapter 8 - Elasticity
Elasticity - measure of a variable's sensitivity to a change in another variable. In
economics, elasticity refers the degree to which individuals
(consumers/producers) change their demand/amount supplied in response to
price or income changes.
‫ تشٌر المرونة إلى الدرجة‬،‫ وفً االلتصاد‬.‫ لٌاس حساسٌة المتغٌر للتغٌٌر فً متغٌر آخر‬- ‫مرونة‬
‫المبلغ الممدم استجابة للتغٌرات فً األسعار أو‬/‫المنتجون) طلبهم‬/‫التً ٌغٌر بها األفراد (المستهلكون‬
.‫الدخل‬

Price elasticly of demand

Formula :

Midpoint formula :

Abs. value of price elasticly Effect on total revenue of an

increase in price
Elastic >1 Total revenue falls
Inelastic <1 Total revenue rises
Unit elastic =1 Total revenue unchanged

Income elasticly of demand

Formula :

Types of product Value of income

Normal and necessity (+) but < 1
Normal and luxury (+) but > 1
inferior (-)

Cross-price elasticly of demand

Formula :
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Types of product Value of cross

price
Substitutes (+)
Complements (-)
unrelated 0

price elasticly of supply

Formula :

Value of price
Elastic >1
Inelastic <1
Unit elastic =1

Chapter 9 – production in short run

The production function relates the quantity of factor inputs used by a business to the amount of
output that result.

Short run: a period of time sufficiently short that at least some of the firm’s factors of production
are fixed

Long run: a period of time of sufficient length that all the firm’s factors of production are variable

Total product is total output produced in agiven period

Marginal product = Q/labor

Average product of labor = tp /labor

Stage of production Short run productin function

Stage1 *total product(tp) is increase at inc.
rate
*marginal product of labor is
increase
*average product lapor is increase
At the border MP is maximized
between stage1 and
stage2
Stage 2 (1st) *Tp is inc. at dec. rate
*Mp is dec.
*Ap is increasing
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Stage 2 at the border Ap is maximized

between (1st) and Mp = ap
Stage2 (2nd) Tp is still is inc. at dec. rate
*mp is dec.
*ap is dec.
At the border Tp is max.
between stage2 and Mp=0
stage3
Stage3 Tp is dec.
Mp is negative

Chapter 10 - cost of production in short run

Total cost: the sum of all payments made to the firm’s fixed and variable factors of production

Variable cost: the sum of all payments made to the variable factors of production

Marginal cost: the change in total cost divided by the corresponding change in output as output
changes from one level to another (by definition it consists of the variable costs)

MC = change in total costs / change in output

Average total cost (ATC): total costs / total output

Average variable costs (AVC): variable costs/ total output

Stage of production Short run cost function

Stage1 Total variable cost & total cost are
inc. as dec. rate
Marginal cost is dec.
Average variable is dec.
At the border Mc is min.
between stage1 and
stage2
Stage 2 (1st) Vc &tc are inc. at inc.rate
Mc is inc.
Avc is still dec.
Stage 2 at the border Avc is min.
between (1st) and Mc= avc
(2nd )
Stage2 (2nd) Vc & tc are still inc. at an inc.rate
Mc is inc.
Avc is inc.
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Vedio

Ch1 to 7

https://www.youtube.com/watch?v=3aIar63oDic

Ch8

https://www.youtube.com/watch?v=q3IByubSSYE

Ch9

https://www.youtube.com/watch?v=n_Pjy-V47-s

Ch10

https://www.youtube.com/watch?v=dgh6o6vvclo

‫ملخصات تانيه‬

https://drive.google.com/.../15MLXXulFozp72H34wqYSZf5fyic...

https://drive.google.com/.../1bSaTv9k2dTS2t5fQCBu9qZu...

https://drive.google.com/.../14N7AEZLS990AihKYpk6.../view...

https://drive.google.com/.../1ZjMC.../view...

Bank question

https://academic.udayton.edu/PMIC/MC%20Questions/Chap%201%20mc.pdf

http://www.damanhour.edu.eg/pdf/128/Macro%20II%20ch3.pdf

https://academic.udayton.edu/PMIC/Quizzes/micro%20quiz4.pdf