1.1 economic methodology

Question 1

define economics as a social science

Answer 1

studies the relationships between individuals and societies

Question 2

similarities in methodology from natural and other sciences

Answer 2

scientific as findings are measured and tested, however controlled lab experiments aren’t possible. and can’t keep variables constant.

Question 3

what economic terminology is relied upon when testing an economic theory

Answer 3

‘ceteris parabis’ - everything else remaining equal, as in economics variable can’t be kept constant

Question 4

what’s a positive statement

Answer 4

an objective statement that can be proved

Question 5

a normative statement

Answer 5

opinion or value judgement- can’t be tested against facts or proved\disproved

Question 6

value judgements

Answer 6

a statement/view that isn’t testable- a matter of opinion, so will influence economic decision making and policy, depending on individuals value judgement.

Question 7

what influences economic agents decision making

Answer 7

political judgement, short-term outcomes, moral judgement and normative statements.