BNAD 301 Lecture Notes - Lecture 1: Opportunity Cost

• School: University of Arizona
• Department: Business Administration
• Course: BNAD 301
• Professor: Mark Stegeman

Document Summary

Bring in your clicker next class- worth 10% of the final grade. Uses hypothesis and theory to make testable predictions (if x, then y) Systematic program of testing those predictions against received or experimental data, and revising the theory accordingly. Too complex to understand, we seek partial understanding through models and assumptions. System is complicated, changes, and it is hard to do experiments. Too many social systems in place to make it testable. Data often does not indicate a superior theory or model. Intuition about behavior and institutions is useful for helping to choose between models, but it should never take precedence. Political biases can affect economists choice of models and interpretations. Normative: makes recommendations to individuals, firms, or gov; requires value judgments.