{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Macro Definitions 1

Macro Definitions 1 - DEFINITIONS Economics The study of...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
DEFINITIONS: Economics: The study of how society manages its scarce resources. Scarcity: The limited nature of society’s resources. Opportunity cost: Whatever must be given up to obtain some item. Incentive: Something that induces a person to act. Market Economy: An economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services. Micro: The study of how households and firms make decisions and how they interact in markets. Macro: The study of economy wide phenomena, including inflation, unemployment, and economic growth. Normative Statements: Claims that attempt to prescribe how the world should be. Positive Statements: Claims that attempt to describe the world as it is. Absolute advantage: The ability to produce a good using fewer inputs than another producer. Comparative advantage: The ability to produce a good at a lower opportunity cost than another producer.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}