1.1 / 1.2 Economics Methodology and nature and purpose of economic activity Flashcards
Economics definition
The process of the movement and/or decision of where money is given or held and the effects it has
What is Ceteris paribus?
That other things are being held equal or constant, so nothing else changes
What is the central purpose of economics?
To produce goods and services to satisfy people’s needs and wants to improve their economic welfare
What is falsification?
Putting your hypothesis up to be knocked down. If it survives it becomes a theory
Definition of a normative statement
Normative statement is a statement that includes a value judgement and cannot be refuted just by looking at the evidence
What is a normative statement?
They are opinions
What are normative statements often referred as?
Value judgements
Definition of a positive statement
A positive statement can be tested against facts and scientifically tested to if it is true
What do positive statements not take into account?
Positive statements are made without obvious value-judgements and emotions
