Chapter 1
Graphical Expression
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Economic Principles #1- Generalizations
Economic principles are generalizations relating to economic behavoir or to the economy. Economic principles are expressed as the tendencies of typical or avewrage consumers, workers, or business firms.
Aggregate
a collection of specific economic units treated as if they were one unit.
Budget Line
a schedule or curve that shows various combinations of two products a consumer can purchase with a specific money income.
Macroeconomics
examines either the economy as a whole or its basic subdivisions or aggregates, such as the governement, household, and business secters.
Positive Economics
focuses on facts and cause-and-effect relationships.
Normative Economics
ioncorporates value judgements about what the economy should be like or what particular policy actions should be recommended to achieve a desireable goal (policy economics). "should" "ought"
Other-Things Equal Assumption (ceteris paribus)
the assumption that factors other than those being considered do not change.
Economizing Problem
the need to make choices because economic wants exceed economic means will enhance your understanding of economic models and the difference between microeconomic and macroeconomics analysis.
Microeconomics
the part of economics concerend with individual units such as a person, a household, a firm, or an industry.
Macroeconomics speaks on the measures of
total output, total employment, total income, aggregate expenditures, and the general level of prices in analyzing various economic problems.
