10 Principles Of Economics Flashcards

1
Q

Principle #1

A

People face trade offs

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2
Q

Principle #2

A

The cost of something is what you give up to get it

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3
Q

Principle #3

A

Rational people think at the margin

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4
Q

Principle #4

A

People respond to incentives

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5
Q

Principle #5

A

Trade can make everyone better off

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6
Q

Principle #6

A

Markets are usually a good way to organize economic activity

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7
Q

Principle #7

A

Governments can sometimes improve market outcomes

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8
Q

Principle #8

A

A country’s standard of living depends on its ability to produce goods and services

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9
Q

Principle #9

A

Prices rise when the government prints too much money

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10
Q

Principle #10

A

Society faces a short run trade off between inflation and unemployment

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