Test bank 60 questions and answers separately

Summary Contemporary Economics Carbaugh 9th edition 2024 9781032572574 Summary Chapter 1 - 7, 9, 10, 12, 19, 20, 21, 22 Contemporary Economics - An Applications Approach Robert Carbaugh

9781032572574

9 th edition 2024

• Test bank 60 questions and answers (separately)
• 50 core concepts explained alphabetically 1 / 4

Summary Contemporary Economics Carbaugh 9th edition 2024 9781032572574 Contents Chapter 1 Economic agents....................................................................................................................3 Chapter 2 Scientific methods..................................................................................................................4 Chapter 3 Optimization in levels.............................................................................................................7 Chapter 4 Markets..................................................................................................................................9 Chapter 5 Budgets................................................................................................................................12 Chapter 6 Competitive markets............................................................................................................15 Chapter 7 Reservation value.................................................................................................................20 Chapter 9 Externalities.........................................................................................................................22 Chapter 10 Budget deficits...................................................................................................................25 Chapter 12 Pricing and markets...........................................................................................................27 Chapter 19 Income...............................................................................................................................29 Chapter 20 GDP per capita...................................................................................................................31 Chapter 21 Economic growth...............................................................................................................33 Chapter 22 Prosperity...........................................................................................................................35 Test bank 60 questions and answers....................................................................................................37 50 core concepts explained alphabetically...........................................................................................40 2 / 4

Summary Contemporary Economics Carbaugh 9th edition 2024 9781032572574 Chapter 1 Economic agents An economic agent is an individual or a group that makes choices.“Choice – not money – is the unifying feature of all the things that economists’ study” Scarce resources are things that people want, where quantity that people want exceeds the quantity that is available.Scarcity is the situation of having unlimited wants in a world of limited resources.Economics is the study of how agents choose to allocate scarce resources and how those choices affect society.Positive economics is analysis that generates objective descriptions or predictions about the world that can be verified with data.Normative economics is analysis that prescribes what an individual or society ought to do.Microeconomics is the study of how individuals, households, firms, and governments make choices, and how those choices affect prices, the allocation of resources, and the well-being of other agents.Macroeconomics is the study of the economy as a whole. Macroeconomists study economy- wide phenomena, like the growth rate of a country’s total economic output, the inflation rate, or the unemployment rate.Trying to choose the best feasible option, given the available information, is optimization.“People make choices that are motivated by calculations of benefits and costs” Equilibrium is the special situation in which everyone is simultaneously optimizing, so nobody would benefit personally by changing his or her own behaviour.Empiricism is analysis that uses data. Economists use data to test theories and to determine what is causing things to happen in the world.“In the cases where agents fail to optimize, normative economic analysis can help them realize their mistakes and make better choices in the future” An economic agent faces a trade-off when the agent needs to give up one thing to get something else.A budget constraint shows the bundles of goods or services that a consumer can choose given her limited budget.Opportunity cost is the best alternative use of a resource.Cost-benefit analysis is a calculation that adds up costs and benefits using a common unit of measurement, like dollars.

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Summary Contemporary Economics Carbaugh 9th edition 2024 9781032572574 “Learning how to make good choices is the biggest benefit you’ll realize from learning economics” Summary •Economics is the study of how agents choose to allocate scarce resources and how those choices affect society. Economics can be divided into two kinds of analysis: positive economic analysis (what people actually do) and normative economic analysis (what

people ought to do). There are two key topics within economics: microeconomics

(individual decisions and individual markets) and macroeconomics (the total economy).•Economics is based on three key principles: optimization, equilibrium and empiricism.•Choosing the best feasible option, given the available information, is optimization. To optimize, an economic agent needs to consider many issues, including trade-offs, budget constraints, opportunity costs, and cost-benefit-analysis.•Equilibrium is a situation in which nobody would benefit personally by changing his or her own behaviour.•Economists test their ideas with data. We call such evidence-based analysis empirical analysis or empiricism. Economics use data to determine whether our theories about human behaviour – like optimization and equilibrium – match actual human behaviour. Economists also use data to determine what is causing things to happen in the world.Chapter 2 Scientific methods Key terms The scientific method is the name for the ongoing process that economists and other scientists use to (1) develop models of the world and (2) test those models with data.A model is a simplified description, or representation, of the world. Sometimes, economists will refer to a model as a theory. These terms are often used interchangeably.“All scientific models make predictions that can be checked with data” Data are facts, measurements, or statistics that describe the world.Empirical evidence is a set of facts established by observation and measurement. Hypotheses are predictions (typically generated by a model) that can be tested with data. The mean, or average, is the sum of all the different values divided by the number of values. “Think of causation as the path from cause to effect” Causation occurs when one thing directly affects another through cause-and-effect relationship.Causation relates two variables in an active way – a causes b if, because of a, b has occurred.

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