basic economic analysis Flashcards
when considering the allocation of scarce resources, what are some questions the countries have to ask themselves ?
- what to produce?
- how much to produce ?
- who to produce them ?
- what production method should be used ?
- who receives the output ?
name and define the key analytical techniques in micro economics ?
marginal reasoning - the examination of the benefits vs the costs of an activity.
equilibrium analysis - examining why some *’s exist and why they change. also helps with understanding why some don’t exist
comparative statics - analysing changes in models and there impacts. analysing endo and exo variable effects.
define
a. exogenous variable
b. endogenous variable
a. a variable with a fixed value outside of the model
b. a variable whose value is determined within the model
define
a. positive statement
b. normative
a. a statement that can be tested and researched
b. cannot be confirmed, opinion based
