Chapter 1 Flashcards
refers to the fact that everyone has unlimited wants.
Insatiability
The state of being in a short supply; shortage.
Scarcity
Curbing Insatiability and Living with Scarcity
Contentment
Using wisely and well what God has given to you
Stewardship
the value people place on a good or service, and that value, in turn, helps to determine the price of the good or service
Economic cost
any tangible (physical) thing that has a measurable life span.
Goods
intangible items, include the labor of the accountant, the performance of the singer, and the work of the teacher.
Services
goods and services that bear a positive economic cost (a price tag higher than zero)
Economics goods and economic services
Goods that a consumer pays to have removed are said to bear a negative economic cost
nuisance goods. Examples include cardboard, containers, used paper towels, broken toys, empty bottles, dirty motor oil, other garbage, toxic waste, and sewage.
turning various nuisance goods into economic goods
Recycling
Goods and services with a price tag of zero
Free goods and free services
What principle states a thing is valuable because of the nature of the product, such as its scarcity or the amount of labor and natural resources that goes into its production.
intrinsic value
A principle that states an object’s usefulness to the buyer that determines its worth.
Subjective value
the satisfaction you receive from the choice you make.
Opportunity benefit
satisfaction you give up or the regret you experience for not choosing differently.
Opportunity cost
The approach of observing economic choices and predicting economic events is referred
Positive economics
refers to making value judgments about existing or proposed economic policies.
Normative economics
What is economics?
the science of why people, businesses and governments make the choices they do
What two contradictory ideas result in the necessity of choice?
insatiability and scarcity
What character quality is essential for the Christian to have victory over insatiability?
contentment
What is the difference between an economic cost and an opportunity cost?
economic cost is the value placed on things and opportunity cost is the satisfaction you get from not choosing differently.
What is the difference between intrinsic value and subjective value?
Intrinsic value: valuable according to the nature
Subjective value: valuable according to the buyer
You must choose between going to bed at your regular time or staying up late to study. What would be the opportunity costs and benefits of this decision?
Opportunity cost is health, sleep, clarity of mind
Opportunity benefit is confidence
common- sense science of how and why people, businesses, and governments make the choices they do.
Economics
What is the difference between microeconomics and macroeconomics ?
microeconomics deals with choices made by individual units
Macroeconomics examines large-scale economic choices and issues.
What is the difference between positive and normative economics?
Positive economics is observing economics choices
Normative economics is making value judgements on policies
What idea did Menger propose that radically changed the way economists should determine an object’s value?
The individuals “public good”
