Economics

1. Economics- the study of the behavior of people and institutions in production, distribution, and consumption of scarce goods.
1. Economic Theories- generalizations based upon a careful observation of facts.
2. Normative Statement- based upon value judgments.
3. Positive Statement- what is
4. Concept of Economic Efficiency- concerned w/ obtaining max output from available resources.
5. Fundamental Problem of Econ.- scarcity of productive resources relative to material wants.
6. Econ. Resources- Factors of Production
7. Market- an institution which brings together buyers and sellers.
8. When an economy is operating w/ max efficiency, the production of more of “A” and less of “B”
9. Money payments made to land owners: rent, wages, interest, and profits.
10. Production Possibility Curve- all resources of an economy are in use, more of one only if less of another.
11. Any point inside the production possibil...