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19 Cards in this Set
- Front
- Back
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Economics
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A Social Science. How Individuals and Society make choices regarding the uses of scarce resources.
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Scarcity
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The basic economic problem. Not enough resources for unlimited needs
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Resources
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Also known as factors of production or inputs
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Land
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Gifts of nature; Wildlife, mineral, oil
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Labor
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Wages
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Capital
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The physical plant/equipment used in the production cost. Capital is financed with interest
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Entrepreneurship
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Organizes the other factor of productions to produce a good or service. The risk or the Innovator. Paid by profits
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Opportunity Cost
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The Next best alternative thats given up when a choice is made.
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Microeconomics
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Studies the decisions of individuals, households, and firms.
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Macroeconomics
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Studies economics aggregates, such as the national unemployment rate, the rate of inflation, and the economy's growth rate. The whole economy.
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Positive
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Addresses "What is"
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Normative
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What should we do about it. Making a value judgement
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Theory
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An obstruction of reality. used to discuss real world relationships & behaviors. Used to predict outcomes.
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Models
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Used to state theories
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Ceteris Paribus
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All else constant
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Fallacy of False Caus
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Also known as Post Hoc Fallacy. Occurs when it is assumed that because event P followed event A, then event A must have caused event P. It is a associate event fallacy.
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Fallacy of Composition
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Assumed what is true for the part is true for the whole.
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Fallacy of Division
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Assumed what is true for the whole is true for the part.
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Chapter 1
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Introduction to Microeconomics
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