CHAPTER 1 ECONOMICS AS A SOCIAL SCIENCE

Question 1

Ceteris paribus

Answer 1

All things being equal: the assumption that, whilst the effects of a change in one variable are being investigates, all other variables are kept constant.

Question 2

Law

Answer 2

A theory or model which has been verified by empirical evidence.

Question 3

Normative Economics

Answer 3

The study and presentation of policy prescriptions involving value judgements about the way in which scarce resources are allocated.

Question 4

Normative statement

Answer 4

A statement which cannot be supported or refuted because it is a value judgement.

Question 5

Positive economics

Answer 5

The scientific or objective study of the allocation of resources.

Question 6

Positive statement

Answer 6

A statement which can be supported or refuted by evidence.

Question 7

Scientific method

Answer 7

A method which subjects theories or hypotheses to falsification by empirical evidence.

Question 8

Social science

Answer 8

The study of societies and human behaviour using a variety of methods, including the scientific method.

Question 9

Theory or model

Answer 9

A hypothesis which is capable of refutation by empirical evidence.