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Unformatted text preview: 2. THE COST OF SOMETHING IS WHAT YOU GIVE UP TO GET IT a. Opportunity cost: what you give up to obtain something a.i. Giving up job for college time. 3. RATIONAL PEOPLE THINK AT THE MARGIN a. Rational people: people who systematically/purposefully do the best they can to achieve their objectives b. Marginal changes: small incremental adjustments to plan of action c. Marginal benefits/costs 4. PEOPLE RESPOND TO INCENTIVES a. Incentives: HOW PEOPLE INTERACT: 5. TRADE CAN MAKE EVERYONE BETTER OFF 6. MARETS-GOOD WAY TO ORGANIZE ECONOMIC ACTIVITY 7. GOVERNMENTS CAN SOMETIMES IMPROVE MARKET OUTCOMES HOW THE MARKET WORKS AS A WHOLE 8. COUNTRY DEPENDS ON GOODS/SERVICES PRODUCED 9. GOVERNMENT PRINTS TOO MUCH $: INFLATION 10. SHORT-RUN TRADE OFF B/W INFLATION/UNEMPLOYMENT...
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This note was uploaded on 01/19/2012 for the course GEOL 123 taught by Professor Kim during the Winter '11 term at Bowling Green.
- Winter '11