ECON 105 Lecture Notes - Gross National Product, Net National Product, Gdp Deflator

• School: Simon Fraser University
• Department: Economics
• Course: ECON 105
• Professor: Dennis Sandgathe

Document Summary

A model is a simplified representation (in words, pictures and/ By leaving out complex stuff, simplifications can be useful. Propose a model of the social process of interest. If model and reality are consistent, keep it. Economist often make a distinction between normative and positive analysis what should be/ |what is. If al and betty can agree to specialize and share the extra production of 20 fcvs, they will both be better off. Social conventions (for example, gift giving, banquet, etc) Bargaining: time costs are high, hold up problem. Markets: a market is a group of buyers and sellers for a particular good or service. This means they act as if they can buy or sell as much as they want at the going price: competition markets exist. We want to distinguish between market demand and individual demand. Market demand can be constructed by adding up individual demand across all individuals .