ECON101- Midterm Exam Guide - Comprehensive Notes for the exam ( 16 pages long!)
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ECON101 Full Course Notes
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Economics the study of the choices people make and the actions they take in order to make the best use of scarce resources in meeting their wants and needs. The(cid:374) a si(cid:373)ple (cid:396)ule of e(cid:272)o(cid:374)o(cid:373)i(cid:272)s is if benefits (x) is larger than the costs (x), then do the activity x; if costs (x) is greater than benefits (x), then do not do activity x. Set the speed limit on the highway edmonton to calgary to 10 km/h. Thinking on the margin if marginal benefits (activity x) is larger than marginal costs (activity. Judging economic allocations allocation of resources can be evaluated on the basis of: efficiency (pareto efficiency) Allo(cid:272)ati(cid:448)e effi(cid:272)ie(cid:374)(cid:272)(cid:455) is p(cid:396)ese(cid:374)t (cid:449)he(cid:374) so(cid:272)iet(cid:455)(cid:859)s (cid:396)esou(cid:396)(cid:272)es a(cid:396)e so o(cid:396)ga(cid:374)ized that the present value of net benefits (maximizing total benefit-total. Cost) are maximized. (the market price is lower than the maximum price that people are willing to pay for the resource: equity.
