part 2 - Basic Economics and Economic Systems Basic...

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Basic Economics and Economic Systems
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Basic Economics and Economic Systems Introduction to Economics Employ resources which have alternative uses… … to produce various goods and services… … and distribute them for consumption, among various competing groups and individuals. As discussed, economics is the study of how a society chooses to… Economics is usually categorized into two areas: macroeconomics and microeconomics.
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Basic Economics and Economic Systems Introduction to Economics (cont.) Macroeconomics Macroeconomics Macroeconomics is the study and analysis of the overall economy using information such as unemployment, inflation, production, gross domestic product, industrial production and price levels. Microeconomics Microeconomics Microeconomics is concerned with individual parts of the economy such as decisions made by individuals, households, and firms and how these decisions interact to form the prices of goods and services and the factors of production.
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Basic Economics and Economic Systems (An Incredibly) Brief History of Economics The study of the economy in Western civilization began largely with the Greeks, particularly Aristotle and Xenophon, commonly referred to as the "Ancients“. The "Scholastics”, a group of 13th and 14th century theologians, created economic dogma that was particularly concerned with property, justice in economic exchange, money, and usury. The "School of Salamanca“, initiated around 1536 at the University of Salamanca (founded 1218), reversed centuries of Scholastic thinking on economic matters including “just price”, scarcity theory, and supply-and-demand. Aristotle Xenophon St. Thomas Aquinas
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Basic Economics and Economic Systems The “Mercantilists” (1500’s -1700’s) sought advantage for a specific, trade, merchant, joint-stock company or social group, with their primary objective being to increase the power of the nation-state. Jean Baptiste Colbert Sir William Petty Economies that followed mercantilism policies tended to see trade, colonialism and conquest as the primary ways of increasing wealth. (An Incredibly) Brief History of Economics (cont.) With the social upheavals of the industrial age, economics turned to more modern issues. Economists like Ricardo and Malthus probed issues critical to their times such as overpopulation, food distribution, wealth, etc. David Ricardo Thomas Malthus
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Basic Economics and Economic Systems In 1776, Scottish economist Adam Smith published An Inquiry into the Nature and Causes of the Wealth of Nations (often called The Wealth of Nations). (An Incredibly) Brief History of Economics (cont.) Adam Smith - The role of self-interest in the economy - Division of labor - The function of markets - Impacts of a laissez-faire economy - The “Invisible Hand” - Benefits of specialization - Benefits of free trade - Freedom of ownership Wealth of Nationsintroduced pivotal concepts including:
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This note was uploaded on 06/13/2009 for the course BMGT 110 taught by Professor Nelson during the Spring '08 term at Maryland.

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part 2 - Basic Economics and Economic Systems Basic...

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