IB Diploma Programme Economics SL, Unit 1 Introduction to economics (first assessment 2022). Unit 1 is common to SL and HL; SL sits Papers 1 and 2 plus the portfolio (no Paper 3). This topic covers syllabus sections 1.1 and 1.2 in full: what economics is (scarcity, choice, the economic agents, positive and normative statements) and how economists approach the world (the scientific method, economic models, the ceteris paribus assumption, and the nine key concepts that frame the whole course). Worked numbers are original and re-derived below.

Must-know for Unit 1:

Economics 经济学 studies the choices made by economic agents — CONSUMERS, PRODUCERS and the GOVERNMENT (joined later by the rest of the world) — under scarcity 稀缺性: unlimited wants against finite resources. Because resources are scarce, every choice has an opportunity cost 机会成本 — the next-best alternative forgone — and the basic economic questions are what to produce, how to produce it, and for whom. A student's hour spent revising economics cannot also be spent at work; a government budget spent on hospitals cannot also build schools. Economic resources 资源 (the factors of production) are land, labour, capital and enterprise, and each earns a reward — rent, wages, interest and profit.

The distinction that runs through every Paper 2 data response: a POSITIVE statement is testable against evidence ("the inflation rate fell to 3%"), while a NORMATIVE statement carries a value judgement ("inflation should be lower"). Economists can disagree about values while agreeing about facts, and exam answers must keep the two apart.

Worked example. A government has 10 billion to spend and can build one hospital (benefit valued at 10 bn) or two schools (benefit valued at 7 bn). Choosing the hospital has an opportunity cost of the two schools' 7 bn of benefit; the choice is rational if the hospital's benefit exceeds that of the best alternative forgone.

Economics follows the scientific method 科学方法: observe, form a hypothesis, build a model 模型 — a simplified representation of reality (demand curves, production possibility frontiers, circular flow) — make predictions, and test them against data, revising the model when it fails. Models deliberately simplify: their value is explanation and prediction, not photographic realism. The ceteris paribus 其他条件不变 assumption ("all other things equal") lets the economist isolate one relationship at a time — how quantity demanded responds to price, holding income and tastes fixed — the same discipline used in every later unit.

IB economics frames the whole course through nine key concepts 核心概念: SCARCITY and CHOICE (the underlying problem), EFFICIENCY and EQUITY (how well and how fairly resources are used), ECONOMIC WELL-BEING and SUSTAINABILITY (outcomes now and for the future), CHANGE, INTERDEPENDENCE (agents and nations linked through trade and markets) and INTERVENTION (when and how governments act). Every real-world issue the syllabus examines — and every portfolio commentary — is analysed through these lenses.

Worked example. A tuition subsidy is a model question: the hypothesis is that lower fees raise enrolment; the model (demand) predicts enrolment rises when price falls, ceteris paribus; the test compares enrolment before and after, or across regions with and without the subsidy; a mismatch (say, enrolment flat because incomes also fell) sends the economist back to re-specify the model — the method in one loop.

• Economics defined through scarcity and choice; the three (later four) economic agents (1.1).
• Opportunity cost applied to consumers, producers and government (1.1).
• Resources/factors of production and their rewards (1.1).
• Positive versus normative statements, with the disagreement insight (1.1).
• The scientific method loop: hypothesis → model → prediction → data test → revision (1.2).
• Models as deliberate simplifications; ceteris paribus and what it isolates (1.2).
• The nine key concepts framing every unit; in Paper 1 name the concept, then the theory (1.2).