ECON 103 Lecture Notes - Lecture 1: Macroeconomics, Rationality, Deductive Reasoning
16 Mar 2016
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It relates o individual perspecive and decision making. The descision makers (people, companies, etc. ) are called economic agents. Studies th societal outcomes that arise from these decisions (are they good or bad?) Any environment in which an exchange takes place. Most oten, goods are traded for money. We use market eiecency to determine whether it"s good or bad. It allows us to change the outcomes of a market in order to caus posiive societal changes. Introductoy concepts an models posiive v normaive statements scarcity. We use models: allow us to take basic concepts and assumpions and analyze them rigorously, use them to make predicions, allow us to make normaive and posiive statements. Normaive statements: a statement about what should be. Steps in making a model: make assupions, use deducive logic, make conclusions. Models are simpliicaions, they omit many truths about the real world. By how much one is willing to pay (wtp) for something.
