ch 2: models and graphing Flashcards
1
Q
positive analysis
A
“what is” “what will be”
2
Q
normative analysis
A
“what ought to be” is at the heart of debate
3
Q
economic models
A
simplified versions of the real word economy
4
Q
PPC assumes:
A
technology is fixed
quantity of resources is fixed
society produces only 2 goods
5
Q
PPC assumptions
A
technology fixed
quantity of resources
society produces only 2 goods
6
Q
the only way to get more of one good is to accept less of another
A
trade offs
7
Q
endogenous factors
A
variables that can be controlled inside model
8
Q
exogenous factors
A
variables that cannot be accounted for in a model
9
Q
specialization creates
A
improvements in technology, increase in resources generate gains
