Economics Chapter Summaries

Economics Chapter Summaries - CHAPTER 1 Economics: The...

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CHAPTER 1 Economics : The study of how individuals and organization organize, allocate, and use the limited resources that have been provided by nature and previous organization in order to satisfy their needs and unlimited wants. Opportunity cost: The best alternative that we forgo, or give up, when we make a choice or a decision. Marginalism: The process of analyzing the additional or incremental costs or benefit arising from a choice or decision. Sunk cost: the costs that cannot be avoided as they are already been incurred. Efficient market : A market in which profit opportunities are eliminated almost instantaneously. “There is no such thing as free lunch” The use of studying Economics : To understand society, global affairs, to be an informed citizen. Scope of Economics: 1. Microeconomics : The branch of economics that examines the functioning and the decision making behavior of organization and households; the individual industries. 2. Macroeconomics : The economics branch that examines the economic behavior of aggregates or a nation. Positive Economics : An approach that understands the behavior and the system operation by describing what exists and how it works without making judgment. It is divided into descriptive economics and economic theory. Normative Economics
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This note was uploaded on 09/25/2010 for the course FEUI ACCT01 taught by Professor Prof.steve during the Spring '10 term at Indonesian Computer University.

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Economics Chapter Summaries - CHAPTER 1 Economics: The...

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