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Micro I_Chapters1-5

Micro I_Chapters1-5 - Macroeconomics Dr.Safarzadeh Chapters...

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Macroeconomics Dr. Safarzadeh Chapters 1 - 5
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Chapter 1    Introduction What is Economics? Economics is Concerned with Optimum  Allocation  of  Limited Resources  Among  Unlimited Wants . What Are Economics Resources?  Economics Resources or Factors of Production are:  Labor  Land  Capital  Entrepreneur
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Chapter 1    Introduction Labor includes   Skilled and  Unskilled Labor.  Land includes   the   Land and All the Resources on the  Land and Under the Land.  Capital includes :   Physical Tools of Production.   Note  that, in economics only physical tools of production are considered  as capital.  Money, bonds, and stocks are not capital. Why Do We Study Economics? Because economic resources are limited. 
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Chapter 1    Introduction Limited or Scarce Resources are Resources that we  pay a price for:   Factor Prices Are:  Price of Labor:    Wages  Price of Land:    Rent  Price of Capital:    Interest  Price of Entrepreneur:    Profit How Do We Know a Resource is Limited? How Do We Allocate Economic Resources? The way Economic Resources are Allocated Depends on  Economic Systems.
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Chapter 1    Introduction Economic Systems:  Free Market System  Command Economy  Mixed Economy In every economy, the economic system decides  what to  produce how to produce , and  for whom to produce . In a free market economy, the  market  or  demand and  supply  decides the resource allocation. In a command economy the  central planner  or the  government decides the resource allocation.
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Chapter 1    Introduction Statements Based on Value Judgment and Personal Norms.   The way Things Should be (Based On our Own Value  Judgment). Positive Economics: Statements   Based on Fact, Data, The Way Things Are. Microeconomics:    Study of Individual Economic Units.   Topics such as consumer behavior or theory of firm. Macroeconomics:    Study of the economy as a whole or at  the aggregate level.  The topics of interest in macro- economics are inflation, unemployment, GDP growth, the  role of government, and the Fed.
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Chapter 1    Introduction Normative Economics: Three Main Objective of Every   Economy:  Full Employment  Stable Prices   Economic Growth Conflicting objectives:   Full Employment and                                 Stable Price Complementary objectives:   Full employment and                                                  Growth Have We Achieved These Objectives?
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