ECON 201 Chapter Notes - Chapter 1: Business Cycle, Mixed Economy, Opportunity Cost
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ECON 201 Full Course Notes
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Document Summary
Since it uses scienti c methods it is called a social science. We study human behaviour to better understand and improve our world. Macroeconomics: the study of the economy as a system in which interactions and feedbacks among sectors determine national output, employment and prices. Microeconomics: the study of individual behaviour in the context of scarcity (p nurie) Mixed economy: goods and services are supplied both by private suppliers and government. Model: a formalization of theory that facilitates scienti c inquiry (enqu te) Theory: a logical view of how things work, and is frequently formulated on the basis of observation. Opportunity cost: what must be sacri ced when a choice is made. Production possibility frontier (ppf): the combination of goods that can be produced using all of the resources available. Consumption possibility frontier (cpf): the combination of goods that can be consumed as a result of a given production choice.
