intro 2 econ

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voluntary trade

adam smith believed that __________________ __________ produced optimal benefits

policy

both positive & normative statements are required in order to create..?

facts; what ought to be

economics evaluates _____________ (positive) to model "__________________________________________" (normative)

resources

economics examines how society manages it's scarce ___________________

is not (but those things are included)

economics is / is not a study of money, prices, buying & selling?

the scientific method & testing of hypotheses

economics is a SCIENCE - it uses..?

ceteris paribus

economists evaluate one variable while holding all other's constant

colonies supply raw materials for England manufacturers

how would England practice mercantilism?

protectionism & government intervention

in "the invisible hand" idea, smith argued against ___________________ and __________________ _____________________ in business & trade

positive

positive or normative statement: high interest rates prohibit many young people from buying their first home ; the US spends more money on its military than any other country

normative

positive or normative statement: taxes in the US should be lowered ; unemployment is a more serious issue than inflation

mercantilism

rulers have always sought to allocate resources to enrich their kingdom - England practiced _______________________

greeks

the earliest know discussions of choice was with the..?

normative economic statements

what are statements that express opinions, goals, value-judgements?

positive economic statements

what are statements using data & facts that can be proved? these can also be a wrong statement because it can be proved wrong

centrally planned, free enterprise, mixed

what are the 3 modern economic systems?

cuba, venezuela, north korea, former soviet union

what countries have a centrally planned economy?

hong kong, singapore, new zealand, switzerland, austrailia, ireland

what countries have a free enterprise economy?

U.S. (and most other countries)

what countries have a mixed economy?

household management

what does "oikonomia" mean?

"with other conditions remaining the same"

what does ceteris paribus mean?

the invisible hand

what idea "killed" mercantilism?

the study of choice

what is economics?

the economy of the country (big picture)

what is macroeconomics the study of?

individual industries / consumers (specific companies, consumers, etc)

what is microeconomics the study of?

oikonomia

what is the philosophy of allocating resources among family members to decide things such as "what's for dinner?"

limitations (people could not just roam free)

while believing in voluntary trade, smith did recognize that there were some ______________ of free markets, but this is not the focus of his work

adam smith

who came up with the idea of "the invisible hand"?

adam smith (1776)

who is the "father" of economics & microeconomics?

john maynard keynes (1930s)

who is the "father" of macroeconomics?


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