ECON 200 Study Guide - Fall 2018, Comprehensive Midterm Notes - Inflation, Gross Domestic Product, Opportunity Cost
ECON 200
MIDTERM EXAM
STUDY GUIDE
Fall 2018
Tuesday, August 22, 2017
1
Econ 200 Lecture
August 22
- production produces income which determines your standard of living
- production depends on your productivity and hours worked
- produce output: goods (tangible) or services (intangible )
- productivity - how much you can produce in an hour/how many hours you're working
- need resources/factors of production/inputs to produce output
- four economic resources we need to produce outputs
- resources — production/technology — output
- 1. land - encompasses the land that production takes place and all natural resources
(renewable or non renewable resources); water sheep cows metal timber minerals
- 2. labor - the physical and mental abilities of workers; quantity (human capital) and quality
(skill, education, training, healthy etc.)
- 3. physical capital (capital) ****** - goods produced in the economy that are used to
produce other goods and services (machines, tools, structures (buildings, factories))
- 4. entrepreneurs - an individual who organized materials and resources for production, may
introduce new products or techniques (innovation and risk taking)
- money is not an economic resource, it is a federal reserve note
- laborers make fixed wage rate, salary
- entrepreneurs incomes not fixed, makes profits or losses depending on business success
- economics - study of how scare resources are allocated among their competing uses
- economics is about limited resources and unlimited wants
- high demand, high price for good
find more resources at oneclass.com
find more resources at oneclass.com
Thursday, August 24, 2017
1
Readings
Chapter 1 Ten Principles of Economics
- word economy comes from Greek word oikonomos meaning “one who manages a household”
- Scarcity means that society has limited resources and therefore cannot produce all the goods
and services people wish to have
- Economics is the study of how society manages its scarce resources
- Four principles about individual decision making 1. trade-offs 2. cost of something is what
you give up to get it 3. rational people think at the margin 4. people respond to incentives
- Making decisions requires trading off one goal against another
- trade-off society faces is between efficiency and equality, two goals often conflict
- Efficiency means that society is getting the maximum benefits from its scarce resources
- Equality means that those benefits are distributed uniformly among society’s members.
- opportunity cost of an item is what you give up to get that item
- Rational people systematically and purposefully do the best they can to achieve their
objectives, given the available opportunities
- marginal change to describe a small incremental adjustment to an existing plan of action,
rather than choosing on e of two extremes
- Rational people often make decisions by comparing marginal benefits and marginal costs
- a person’s willingness to pay for a good is based on the marginal benefit that an extra unit of
the good would yield
- The marginal benefit, in turn, depends on how many units a person already has
- incentive is something (such as the prospect of a punishment or reward) that induces a person
to act
find more resources at oneclass.com
find more resources at oneclass.com
27
ECON 200 Full Course Notes
Verified Note
27 documents
Document Summary
Production produces income which determines your standard of living. Production depends on your productivity and hours worked. Produce output: goods (tangible) or services (intangible ) Productivity - how much you can produce in an hour/how many hours you"re working. Need resources/factors of production/inputs to produce output. Four economic resources we need to produce outputs. 1. land - encompasses the land that production takes place and all natural resources (renewable or non renewable resources); water sheep cows metal timber minerals. 2. labor - the physical and mental abilities of workers; quantity (human capital) and quality (skill, education, training, healthy etc. ) 3. physical capital (capital) ****** - goods produced in the economy that are used to produce other goods and services (machines, tools, structures (buildings, factories)) 4. entrepreneurs - an individual who organized materials and resources for production, may introduce new products or techniques (innovation and risk taking) Money is not an economic resource, it is a federal reserve note.
