Lecture 1 - handout

Lecture 1 - handout - Introduction Keith S. Evans Iowa...

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Unformatted text preview: Introduction Keith S. Evans Iowa State University January 13, 2009 Keith S. Evans (Iowa State University) Introduction January 13, 2009 1 / 18 Questions to ask There are a few questions to address before beginning the class. 1 What is Economics? 2 What is the difference between Economics and Business? 3 Why should we study Macroeconomics? 4 How do we study the Economy? Keith S. Evans (Iowa State University) Introduction January 13, 2009 2 / 18 What is Economics? Definition The study of how individuals and society choose to allocate limited or scarce resources among alternative uses to satisfy their unlimited wants. Alternative: Economics is the social science that studies the choices that individuals, businesses, governments, and entire societies make as they cope with scarcity and the incentives that influence and reconcile those choices - Parkin 2008 Keith S. Evans (Iowa State University) Introduction January 13, 2009 3 / 18 What is Economics? Three key points: 1 Choices : 2 Scarcity : a situation where we are unable to satisfy all out wants. 3 Incentives : a reward that encourages an action or a penalty that discourages one. Example: Do I drive to campus or take CyRide? Keith S. Evans (Iowa State University) Introduction January 13, 2009 4 / 18 The Division of Economics Economics is separated into two distinct categories: Microeconomics focuses on individual and business decision making. Furthermore, it analyzes how these choices interact, and the influence that governments exert on these choices. Macroeconomics is the study of the effects on the national economy of choices made by individuals, businesses, and governments. It focuses on the aggregate outcome....
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This note was uploaded on 08/31/2011 for the course ECON 102 taught by Professor Singerman during the Spring '08 term at Iowa State.

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Lecture 1 - handout - Introduction Keith S. Evans Iowa...

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