ECON 2020U Chapter 1: Principles of Macro [Mankiw, Kneebone, McKenzie] - Chapter 1 Notes
Document Summary
Scarcity > the limited nature of society"s resources. Economics > the study of how society manages its scarce resources. Efficiency > the property of society getting the most it can from its scarce resources. Equity > the property of distributing economic prosperity fairly among the me mbers of society. Opportunity cost > whatever must be given up to obtain some item. Rational people > people who systematically and purposefully do the best they can to achieve their objectives. Marginal changes > small incremental adjustments to a plan of action. Incentive > something that induces a person to act. Market economy > an economy that allocates resources through the decentralize d decisions of many firms and households as they interact in markets for goods a nd services. Property rights > the ability of an individual to own and exercise control ov er scarce resources.
