Economics In One Lesson Flashcards
What does this author claim is the art of economics?
Being able to see what economic policies will do not just in the short term, but in the long term also, and how it will affect ALL groups
What is the most common fallacy nowadays?
To focus on the effects on just one group and ignore the effects on a wholistic basis
What is the broken window fallacy?
If someone breaks a window, that’s good because it provides work and gets money moving in the economy.
What is a classical economist’s focus?
A classical economist’s main focus is on the economy as a whole and on groups as a whole (they also focus mainly on the long term). This brings them criticism when they behave callously when a single or only a few groups are adversely effected.
What is the backed up demand fallacy?
Thinking of purchasing power only in terms of money. More inflation means
Someone’s supply of goods represents…
Their demand for other goods
What is the assumption made when we say that a government program “creates jobs”?
That those jobs would not have come into existence naturally
What do machines, inventions, and discoveries do to real wages?
They increase them
