Micro 1 - what is economics? Flashcards
What is the fundamental economic question?
The fundamental economics problem is that scarcity means there are limited resources but unlimited wants from individuals within an economy
What is scarcity?
The state of being in short supply, especially relative to how much something is demanded
What is opportunity cost?
Opportunity cost is the value of the next best option which can no longer be chosen when an economic decision is made
What is a social science?
It is the scientific study of human interaction and social relationships
What is economic activity?
Combining all the factors of production to create output that people can consume
What is a positive statement?
A subjective statement which is fact based as a result it could be shown to be true or false
What is a normative statement?
A subjective statement based on option so it cannot be proved true or false
What is utilitarianism?
Theory that says the right option is the one that maximises pleasure over the amount of pain it brings to the world
What is libertarianism?
People should be able to do as they please, however, society should intervene if they are harming others with their actions.
What is egalitarianism?
The belief that all people should be treated the same and deserve equal rights and opportunities.
What is authoritarianism/paternalism?
It is when there is absolute power of a state held by one entity (person/group like the government), so they should be able to step in to control our actions in order to prevent us from harming ourselves
What is conservatism?
The belief that structure and traditional social values are important and should be protected
