ECON 201

Occurs when production is in accordance with consumer preferences

Allocative efficiency

The study of the choices people make to attain their goals, given their scarce resources

Economics

The fair distribution of economic benefits

Equity

The study how households and firms make choices, how they interact in markets, and how the government attempts to influence their choices is the study of what?

Macroeconomics

What covers the study of topics such as inflation or unemployment?

Macroeconomics

What analysis is concerned with what ought to be?

Normative Analysis

What analysis is economics about, which measures the cost and benefits of different courses of action?

Positive Analysis

Which analysis is concerned with what is?

Positive Analysis

Occurs when a good or service is produced at the lowest possible cost

Productive efficiency

When we graph the relationship between two variables, we often want to draw conclusions about whether changes in one variable are causing changes in the other variable. Doing so, however, can lead to incorrect conclusions. Reasons for drawing incorrect conclusions about cause and effect include...

Reverse causality and an omitted variable

One of the basic facts of life is that people must make choices as they try to attain their goals. This unavoidable fact comes from a reality an economist calls...

Scarcity

What are the 3 fundamental questions that Trade-offs force society to make choices?

What goods and services will be produced? How will the goods and services be produced? Who will receive the goods and services produced?

Microsft charges a price of $599 for a copy of Windows 7. Is this pricing decision rational?

When we assume the managers at Microsoft have used all available information and have weighed all known benefits and costs, we are assuming rationality

Economics is social science because

it considers human behavior-partially decision making behavior, it applies the scientific method to the study of the interactions among individuals, it is based on studying the actions of individuals

When the federal government crafts environmental politics that make it less expensive for firms to follow green initiatives...

the policies are consistent with economic incentives

Whats an example of of a negative linear relationship?

y=64-5.7x