Unformatted text preview: 9/21/2009 MGT 3320 Distribution Management
Dan C. Parris PhD Fall 2009 – Baylor University Ten Key Principles of Economics
1. 2. 3. 4. 5. 6. 7. 8. 9. Incentives Matter There is no such thing as a free lunch Decisions are made at the margin Trade promotes economic progress Transaction costs are an obstacle to trade Profits direct businesses toward activities… People earn income by helping others Economic progress … The ‘Invisible Hand’ of the market… 10. Too often long-term consequences… Incentives Matter 1 9/21/2009 TANSTAAFL Decisions are made at the margin. Trade promotes economic progress. 2 9/21/2009 Transaction costs are an obstacle to trade. Profits direct businessses toward activities that increase wealth. People earn income by helping others. 3 9/21/2009 Economic progress comes primarily through trade, investment, better ways of doing things and sound economic institutions. The “invisible hand” of market prices directs buyers and sellers toward activities that promote the general welfare. Too often long‐term consequences, or the second order effects, of an action are ignored. 4 ...
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