Ch013 - CHAPTER CHECKLIST <When you have completed your...

Info iconThis preview shows pages 1–5. Sign up to view the full content.

View Full Document Right Arrow Icon
Cobbe ECO2013F03 Chapter 1 Page 1 of 22 < When you have completed your study of this chapter, you will be able to C H A P T E R C H E C K L I S T Define economics, distinguish between micro-economics and macroeconomics, and explain the questions of macroeconomics. 1 Describe the work of economists as social scientists. Explain four core ideas that define the way economists think about macroeconomic questions. Explain why economics is worth studying. 2 3 4 1.1 DEFINITIONS AND QUESTIONS Economic questions and problems arise because human wants exceed the resources available to satisfy those wants . Scarcity The condition that arises because the available resources are insufficient to satisfy wants. Faced with scarcity, we must make choices —we must choose among the available alternatives. The choices we make depend on the incentives we face.
Background image of page 1

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

View Full DocumentRight Arrow Icon
Cobbe ECO2013F03 Chapter 1 Page 2 of 22 JARGON < Economics uses jargon a lot < Jargon means a special vocabulary < Economics jargon can be confusing because it often gives special meaning to ordinary, every day words, that have a different meaning in normal usage < ‘Scarcity’ is our first example of a jargon word in economics. Why jargon? < Jargon allows precision < Jargon allows shorter statements < Jargon permits more efficient communication < It’s standard in economics, so we have to know it to understand economics Quote: Joan Robinson [Professor of Economics at U. of Cambridge] < “You study economics in order to avoid being fooled by economists” < But to do that, we have to learn a lot of definitions and terminology – the jargon of economics.
Background image of page 2
Cobbe ECO2013F03 Chapter 1 Page 3 of 22 Bad aspects of Jargon < Jargon can be used to obfuscate or exclude < Jargon can be confusing to those who are unsure of it < Unnecessary jargon hinders efficient communication rather than helping it Economics as a Foreign Language < ALL economics and economists use jargon to some extent < MOST of economics is common sense < Except for a very few non-intuitive ideas, learning economics amounts to learning how to express what you know already in the right jargon, i.e. it is like learning a new language 1.1 DEFINITIONS AND QUESTIONS Incentive An incentive is a reward or a penalty—a “carrot” or a “stick”—that encourages or discourages an action. Economics The social science that studies the choices that we make as we cope with scarcity and the incentives that influence and reconcile our choices. The subject has two broad divisions—microeconomics and macroeconomics.
Background image of page 3

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

View Full DocumentRight Arrow Icon
Cobbe ECO2013F03 Chapter 1 Page 4 of 22 1.1 DEFINITIONS AND QUESTIONS < Microeconomics Microeconomics : The study of the economic choices that individuals and organizations make, the way these choices interact, and the influence that governments exert on these choices. < Macroeconomics
Background image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 22

Ch013 - CHAPTER CHECKLIST &lt;When you have completed your...

This preview shows document pages 1 - 5. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online