“Nom Nom Nom” is said to have originated with the Cookie Monster. *nom nom nom* It has become a preferred way to express voracious eating. Today the meme has spread to everyday conversation.
Jen – “How’s that sandwich?”
Mark – “Nom nom nom!”
Jen – “I need to get some more noms.”
It is almost certain that the word economics was coined without *nom nom nom* in mind. But if it was not intentional, it was foresighted to put NOM right in the middle of “economics,” as the concept of noming is so central to economics.
One starting point for understanding economics is that everybody wants stuff. Economists study consumption, or noming.
Our first character, Gustav von Om Nom, loves noms. If you do not love cookies as much as Gustav, there must be something you really want. *iPhonomnomnom*
Gustav loves cookies, but first few cookies are really good and after too many cookies they become a bit less appealing. See Decreasing Marginal Utility Graph.
Gustav can buy more cookies if the price of cookies is lower. If the price of a cookie is too high, it’s not worth it. He could use his limited amount of lunch money to buy other things (ex. cheesecake).
At any moment in time, there is a limited amount of cookies in existence. Economists study what to do given the fact that there is a finite amount of noms to go around. Many of the problems humans face can be explained in terms of “scarce resources.”
“allocation of scarce resources” –What is the best use of the limited amount of noms we have?
There will always be a finite amount of stuff, but in the last 150 years the total size of the human economy has grown. Pretty incredible ->
GDP per capita is a rough measure of how much stuff the average person is producing (and therefore consuming) in a year.
The “economic pie” is a term for how much stuff there is to go around in a society. The economic pie has grown significantly in the past few centuries. So a lot of people have more healthcare, shoes, and most importantly cookies.
Here is an excellent resource, especially for understanding the monetary system and its relation to the Great Recession.