01:220:103 Chapter Notes - Chapter 1: Ceteris Paribus, Opportunity Cost, Marginalism
26 Oct 2018
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Document Summary
Economics - the study of how individuals and societies choose to use the scarce resources that nature and previous generations have provided. Three main reasons to study = to learn a way of thinking, to understand society, to be an informed citizen. Opportunity cost - the best alternative that we forgo, or give up, when we make a choice or decision. Marginalism - the process of analyzing the additional or incremental costs or benefits arising from a choice or decision. Efficient market - a market in which profit opportunities are eliminated almost instantaneously. Microeconomics - the branch of economics that examines the functioning of individual industries and the behavior of individual decision-making units - that is, firms and households. Macroeconomics - the branch of economics that examines the economics behavior of aggregates - income, employment, output, and so on - on a national scale.
