econ test 1

econ test 1 - Econ notes: FIRST QUIZ FEB. 3RD Economics is...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Econ notes: FIRST QUIZ FEB. 3RD Economics is the study of scarcity Everybody confronts the scarcity of life and it is a binding constraint o There will always be conflict o There will always be discrimination Economics is the study of choice What is the best way to discriminate? o Skin color? Male female? o Price? Who is willing to pay the price? Price theory: o Demand and supply Microeconomics: take a microscope to the economy- the price and quantity of particular products Macroeconomics: the entire economy as a whole. Ex. Unemployment rate of the entire US Fundamental economic truths: o Every decision you make involves cost and benefits o No free lunches- NEVER Time is your most valuable resource Opportunity cost is NEVER zero o Demand and Supply determine value o Capitalism is the best way to generate happiness if it is based on morals Particularly if it is a moral capitalism Raising the minimum wage will always screw over the lower class o Capitalism is always self-interest What does your self-interest entail? o Must reward “productive” individuals and penalize people who are “unproductive/damaging/evil” When you have tremendous freedom, use it wisely. o Voluntary exchange benefits both parties. Economists love free-trade Revealed preference! It is a win-win situation Economic liberals vs economic conservatives o Economic conservative Never ever wage in price controls! Sound money- low inflation Low and simple taxes- flat tax? Federal budget to be balanced every year Free trade Understand that there are time when there will be downturns in the economy. There are real business cycles but it will correct itself. The gov’t should not try to eliminate the real business cycle
Background image of page 1

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

View Full DocumentRight Arrow Icon
Congress to be on a balanced budget. President to pass the test on demand and supply
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 4

econ test 1 - Econ notes: FIRST QUIZ FEB. 3RD Economics is...

This preview shows document pages 1 - 3. Sign up to view the full document.

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