ECON 103 Study Guide - Final Guide: Pigovian Tax, Progressive Alliance Of Socialists And Democrats, Economic Surplus
20 Feb 2017
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Document Summary
Key concepts: positive vs normative statements, scarcity, trade-offs, bene ts, costs, opportunity cost, sunk costs, marginal analysis, marginal bene t, marginal cost, marginal net bene t. Models- binary and non-binary decision making; marginal analysis. Micro is the study of individual decision making & how they apply to real world choices & trends, we call these decision makers economic agents. We discuss the societal outcomes of these decisions, focusing on market exchanges. Under the right conditions markets can do a good job of allocating scarce resources. Ef ciency is our criteria for good" or bad". Public policy- we study how it is used to improve markets & how society can be improved by implementing them. Two important assumptions: methodological individualism- usually motivated by desire to be happy, rationality- usually people take actions they believe will further their objectives (like being happy) this doesn"t makes us perfect, we still mess up (misinformed).
