[ECONOM 1014] - Final Exam Guide - Ultimate 77 pages long Study Guide!
Document Summary
Chapter 1: big ideas of economics (1-5 for micro) Economics is not just business & money -- economics is the study of how people respond to incentives. People respond to incentives usually in predictable ways. Prison ships - death rate fell from 33% to 1% Captains got paid for every prisoner that got on the ship; incentive changed to captains for paid for every prisoner that off the ship alive. How you score a sports game affects the player"s behavior. Good institutions align self-interest with the social interest. Individuals working for their own self-interest often produce outcomes that help society as a whole. Walmart -- provides a wide variety of items at low prices to produce profit. All decisions involve trade-offs (one of the most important concepts in. Opportunity costs: the true cost of a decision. The value of the wages given up while attending school. More money would be made in that time than the cost of the tuition.
