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Macroeconomics tarea.docx - According to what was covered...

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According to what was covered in class in chapter one,there are three different key features in the Economic perspectiveand in the economic way of thinking. I personally found scarcity,opportunity and choice to be very interesting. Companies aroundthe world almost always choose among scarce resources. In somecases, the resources needed are not completely available all thetime, so these companies must make a choice about whichresources need to be utilized during the production process. Theopportunity cost represents the alternative given up whenselecting one resource over another. I believe these two conceptsare related because some companies may utilize a lower quality,but have more available resources for producing goods. On theother hand, choice is among the most common activity in aneconomy as the individual and the companies must decide thetype of items they need to utilize when filling the needs andwants in all parties in an economy. Also, I had the opportunity toclarify the difference between Macroeconomics andMicroeconomics as one is dealing with the big picture of thewhole economy, and the other is the study of the local effects offirms, families and small-scale groups of business.The function of an economic system is to allocate resourcesto production, and produced goods to consumers. Also, aneconomic system is defined as the structure of production,allocation of economic inputs, distribution of economic outputs,and consumption of goods and services in an economy. It’sdefined as the set of principles and techniques by whichproblems of economies are addressed, such as the economicproblem of scarcity through allocation of finite productiveresources.Moreover, Market equilibrium occurs in a market when allbuyers and sellers are satisfied with their respective quantities atthe market price. Also, it is defined as a situation in which thesupply of an item is exactly equal to its demand. Therefore, sincethere is neither surplus nor shortage in the market, price tends toremain stable.
In last week’s class, we went over chapters 23, 24 and 25.Chapter 23 explained the concept of Gross Domestic Product(GDP). From what I understood, Gross Domestic Product is theTotal Market Value of goods and services produced by a nation.Therefore, falling GDP is a sign of recession setting in. Also, thegross domestic product (GDP) or gross domestic income (GDI)can be described as the basic measurement of a country’seconomic performance and is also the market value of all finalgoods and services made within the borders of a nation in a year.There are three different ways that could be utilized to defineGDP. First, it is equal to the total expenses for all goods andservices produced within the country in a stipulated period oftime. Second, it is to the sum of the value added at every phaseof production (the middle stages) by all the industries within acountry, plus taxes less subsidies on products in the period. Third,

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