Key Terms and Questions 2.25 Gary Becker

Key Terms and Questions 2.25 Gary Becker - Michael...

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Michael Morgenstern Economic Perspectives 103A Professor Zein-Elabdin February 23 rd , 2008 The Economic Way of Looking at Life 1. Economic Approach a. A method of analysis that assumes individuals maximizes welfare as they conceive it, whether they are selfish, altruistic, loyal, spiteful or masochistic. Behavior is forward looking. 2. Welfare a. Welfare is financial assistance paid by taxpayers to certain entities or groups of people who are unable to support themselves, and determined to be able to function more effectively with financial assistance. 3. Preferences a. Choice between alternatives and the possibility of rank ordering of these alternatives, based on happiness, satisfaction, gratification, enjoyment, utility they provide. 4. Constraints a. Constraints are limitations that are outside the control of the norm. 5. Maximizations a. Refers to individuals or societies gaining the maximum amount out of the resources they have available to them. 6.
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Key Terms and Questions 2.25 Gary Becker - Michael...

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