{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Economics-Chapter 4 - Economics International Studies ITS...

Info icon This preview shows pages 1–11. Sign up to view the full content.

View Full Document Right Arrow Icon
Economics & International Studies ITS 201 Miami University, 2010- 11
Image of page 1

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

View Full Document Right Arrow Icon
Defining Economics Economics corresponds to how people organize themselves for the production, distribution, and consumption of goods and services. “… economics is a social science that studies, describes, models, and makes projections about flows of wealth in the process of the production, distribution, and consumption of scarce resources” (76). “the scientific study of the choices made by individuals about alternative uses of scarce resources to satisfy needs and wants” (76).
Image of page 2
Defining Economics (cont.) Derived from the Greek words oikos (can refer to household, hearth, family, and estate. It can be extended to mean a basic unit of society) and nomos meaning “a customary way of behaving.” “The dismal science” (Thomas Carlyle, 19th century): Disparaging term, since economics involves such “gloomy” topics as unemployment and
Image of page 3

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

View Full Document Right Arrow Icon
Economics: Sets of Questions How do we decide to spend our money? Economics & human nature (See p. 75) Serve “Pure economic self-interest” or democracy, public welfare? Greatest benefits at least cost? What are the factors of production and how can they be improved? What are the characteristics of different economic systems, institutions, and incentives? Market economy: How do supply and demand interact in a market economy? Aspects of unemployment, income, and income distribution in a market economy?
Image of page 4
Two Major Branches of Economics: Macroeconomics & Microeconomics Macroeconomics is the study of: Function of global economy Large-scale or overall workings of a national economy Economic connections between and among economic sectors (e.g., industrial and agricultural subdivisions of the economy)
Image of page 5

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

View Full Document Right Arrow Icon
Macroeconomics (cont.) Analyzes patterns of change in aggregate economic indicators & analyzes the effect of government policy on these phenomena: Money supply GDP Recession Inflation Unemployment Industrial production Governments attempt to influence these indicators by implementing macroeconomic policies .
Image of page 6
Microeconomics: Analyzes market behavior of: Economic subgroups or subsectors Individual consumers or corporations Regional markets & competition Major themes include: Patterns of supply & demand that fix the prices of goods Price and output in individual & competing markets
Image of page 7

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

View Full Document Right Arrow Icon
ECONOMIC RESEARCH: 2 Major Points Biggest problem with economic research: Inability to do controlled experiments.* In economics the best you can do is DESIGN REALLY GOOD THEORY . *Controlled experiment: An investigation in which variables are controlled.
Image of page 8
Economic Models, Formulas, & Theories: Model: A representation or schematic description of a system, theory, or phenomenon. Formula: A form or sequence of words or symbols; mathematical statement, rule, or standard procedure for problem solving Theory: Set of statements or principles that explains facts, phenomena, or some aspect of the world; an explanation Model of the Social Dimensions of Macroeconomics (eoearth.org); economic formula (below)
Image of page 9

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

View Full Document Right Arrow Icon
Economic Models & Formulas: Provide a simplified framework to: Illustrate complex processes
Image of page 10
Image of page 11
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}