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Chapter+1+-+Introduction

Chapter+1+-+Introduction - Study Guide To Accompany...

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Chapter 1 Study Guide To Accompany Macroeconomics: Theory and Policy By B. Modjtahedit Prepared by T.J. McCarthy and B. Modjtahedi University of California, Davis
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Chapter 1 What Do Economists Do? We Model for Food K EY P OINTS Three types of resources are used in production Land Labor Capital Three basic economic questions faced by society; relevant because of scarcity What to produce? How to produce it? How to distribute it? (For whom to produce it?) Macroeconomics and microeconomics are related, but not identical, fields; they differ in terms of the level at which behavior is analyzed. Economic statements can be broadly categorized as those dealing with how things are (positive statements) and those dealing with how things should be (normative statements).
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The sum total of all the goods and services produced in a country. Click for the answer Aggregate level of output Key Terms What word or phrase corresponds to the definition or description presented? The study of the decisions made by individual decision-making units and economic conditions prevailing in one particular market or industry. Microeconomics Human wants are unlimited in relation to the available resources in the economy; with the available resources we cannot satisfy the collective wants of all the members of the society . Scarcity Those things we use to produce goods and services; also called production inputs or factors of production.
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