| what is economics | the study of how societies allocate scarce resources to satisfy unlimited wants |
| macroeconomic | the branch of economics that deals with the structure, performance, behavior, and decision-making of the whole, or aggregate, economy |
| microeconomics | the branch of economics that considers the behaviour of decision takers within the economy, such as individuals, households and firms |
| what is ceteris paribus | holding other things constant or all other things to be equal |
| whats a positive statement | are testable, even if they may not necessarily be true. can be proven (will) |
| whats a normative statement | based on opinions or ethics—what someone believes should be. cant be proven (should) |
| whats value judgement | subjective moral beliefs |
| factors of production | land, labour, entrepreneur and capital |
| Examples of macroeconomic data in exams: | • Inflation
• Unemployment
• National income
• Balance of payment statistics |
| microeconomic examples | data on output from a particular industry.
• Price movements
• Productivity levels |
| money is not... | capital |
| whats opportunity cost | Fundamental concept that refers to the value of the next best alternative forgone. |
| what are free goods | A product is only free if all the resources required for its supply were free. |
