The Economic Problem Flashcards
1
Q
What are 3 functions of price mechanism
A
Incentive for firms, rationing for consumers and signally for producers about scarcity
2
Q
What are direct taxes
A
Taxes on income
3
Q
What are indirect taxes
A
Taxes in spending
4
Q
What causes a shift in PPB
A
- finding new resources
- improving technology
- increasing productivity
- improving quality of resources
5
Q
What’s a positive statement
A
Statements that can be tested against real world data
6
Q
What’s a normative statement
A
Opinions that require a value judgments to be made
7
Q
What are Value judgments
A
Statements or opinions that are not testable/verifiable
