chapter 2 Flashcards
1
Q
microeconomics
A
- study of causes and consequences of allocating resources as it affects the workings of the price system
2
Q
macroeconomics
A
- study of the determination of economic aggregates like total output, employment, growth
3
Q
traditional economies
A
- economy in which behavour is based on traditions
- ex. men follow fathers occupations
- little change in techniques
4
Q
command economies
A
- economy in which most economic decisions are made by a central planning authority
5
Q
free market economies
A
- economy in which most economic decisions are made by private households and firms
6
Q
mixed economies
A
- some economic decisions made by firms and household and some by government
- in practice all are mxed
7
Q
government in mixed economy
A
- markets often work well but sometimes government intervention can make society better
8
Q
complexity of modern economies
A
- based on division of labour that necessitates the exchange of goods and services
- exchange in markets, facilitated by use of money
- driven by ongoing revolution in transportation and communications technology - globalization
9
Q
positive statements
A
- claims that describe the world as it is
10
Q
normative statements
A
claims that attempt to describe the world as it should be
